Here's Why You Should Hold on to Donaldson (DCI) Stock Now
Donaldson Company, Inc. DCI is backed by its strong product portfolio, solid demand and focus on innovation and growth investments despite softness in the Life Sciences segment, adversities from the high cost of sales and foreign exchange headwinds.
What’s Aiding DCI?
Business Strength: High levels of global equipment production in Off-Road and On-Road, and accretive pricing are aiding Donaldson’s Mobile Solutions segment. For fiscal 2023, Mobile Solutions’ sales are expected to increase 2-4% from the fiscal 2022 level, driven by growth in On-Road, Off-Road and Aftermarket sales. The Industrial Solutions segment is being supported by dust collection and industrial gases’ part sales and the ongoing strength in the commercial aerospace industry. The company expects Industrial Solutions’ sales to be up 11-13% year over year, driven by sales growth in industrial filtration solutions and aerospace and defense.
Benefits From Acquisitions: Acquired assets are strengthening Donaldson’s top line. DCI acquired Isolere Bio in February 2023. The Isolere buyout enables Donaldson to create leading separation and filtration solutions for emerging genetic-based drugs and Isolere’s revenues are reported within the Donaldson Life Sciences segment. The acquisition of Purilogics, LLC (June 2022) strengthened DCI’s life sciences portfolio by leveraging Purilogics’ unique product offerings.
Rewards to Shareholders: Donaldson’s efforts to reward its shareholders through dividend payments and share repurchases are noteworthy. Dividend payments totaled $110.1 million in fiscal 2022 and $84.1 million in the first nine months of fiscal 2023. The company bought back shares worth $171 million in fiscal 2022 and $119.3 million in the first nine months of fiscal 2023. It is worth noting that the company’s quarterly dividend was hiked 8.7% in May 2023.
Donaldson Company, Inc. Price and Consensus
Donaldson Company, Inc. price-consensus-chart | Donaldson Company, Inc. Quote
In light of the above-mentioned positives, we believe, investors should retain DCI stock for now, as suggested by its current Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
Ingersoll Rand Inc. IR presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks.
IR delivered a trailing four-quarter earnings surprise of 12.6%, on average. In the past 60 days, estimates for Ingersoll Rand’s 2023 earnings have increased 7.5%. The stock has improved 20.3% in the year-to-date period.
Alamo Group Inc. ALG currently sports a Zacks Rank of 1. ALG delivered a trailing four-quarter earnings surprise of 17.7%, on average.
In the past 60 days, estimates for Alamo’s 2023 earnings have increased 12.7%. The stock has gained 28.1% in the year-to-date period.
Axon Enterprise AXON sports a Zacks Rank of 1, at present. The company has a trailing four-quarter earnings surprise of 44.4%, on average.
In the past 60 days, estimates for Axon’s 2023 earnings have increased 13%. The stock has rallied 18.7% in the year-to-date period.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Ingersoll Rand Inc. (IR) : Free Stock Analysis Report
Donaldson Company, Inc. (DCI) : Free Stock Analysis Report
Alamo Group, Inc. (ALG) : Free Stock Analysis Report
Axon Enterprise, Inc (AXON) : Free Stock Analysis Report
