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Here's Why You Should Keep Middleby (MIDD) in Your Portfolio

·3 min read

The Middleby Corporation MIDD is poised to benefit from strong growth in its incoming orders across segments and a robust backlog despite supply-chain constraints, labor restrictions and raw material cost inflation. Improving end-market conditions and solid consumer demands in the Commercial Foodservice and Residential Kitchen segments are driving MIDD’s organic sales. Product innovations and technological enhancement initiatives also bode well for its prospects. Investments in automation and solid product offerings are likely to drive MIDD’s performance in the near term.

Middleby’s acquisition of Colussi Ermes in July 2022 builds its food processing solutions. MIDD also acquired CP Packaging in the same month. The buyout of CP Packaging expands MIDD’s manufacturing operations in the Food Processing Equipment Group by boosting packaging equipment offerings.

MIDD’s takeover of Icetro (July 2022) adds to its growing portfolio of beverage brands. The purchase also expands Middleby’s Asian manufacturing capabilities and provides solutions to support customers expanding in the international markets.

In June, MIDD bought Proxaut, a provider of Auto Guided Vehicles for the industrial processing companies and the food industry, which strengthened its product offerings in the food processing end market. The acquired assets boosted its sales 14.4% and 20.7% in second-quarter 2022 and during the first quarter, respectively.

Middleby is focused on rewarding its shareholders handsomely. In the first six months of 2022, MIDD repurchased shares worth $69 million.  It is open to repurchasing common shares opportunistically.

In light of the above-mentioned positives, we believe, investors should retain the Middleby stock for now, as is suggested by its current Zacks Rank #3 (Hold).

Zacks Investment Research
Zacks Investment Research

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In the past six months, the stock has lost 20.2% compared with the industry’s decline of 9.6%.

Stocks to Consider

Some better-ranked companies from the industrial products sector are discussed below:

Applied Industrial Technologies, Inc. AIT presently sports a Zacks Rank #1 (Strong Buy). AIT delivered a trailing four-quarter earnings surprise of 22.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks.

AIT’s earnings estimates have increased 5.8% for fiscal 2023 (ending June 2023) in the past 60 days. Its shares have rallied 4.1% in the past six months.

Greif, Inc. GEF presently has a Zacks Rank #2 (Buy). GEF delivered a trailing four-quarter earnings surprise of 22.9%, on average.

GEF’s earnings estimates have increased 0.4% for fiscal 2022 (ending October 2022) in the past 60 days. Its shares have risen 18.3% in the past six months.

Valmont Industries, Inc. VMI presently has a Zacks Rank of 2. VMI’s earnings surprise in the last four quarters was 13.7%, on average.

In the past 60 days, Valmont’s earnings estimates have increased 3.8% for 2022. The stock has rallied 26.9% in the past six months.

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The Middleby Corporation (MIDD) : Free Stock Analysis Report
Greif, Inc. (GEF) : Free Stock Analysis Report
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