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Here's Why Hold Strategy is Apt for Donaldson (DCI) Stock

Donaldson Company, Inc. DCI is benefiting from its strong product portfolio, solid demand and focus on innovation and growth investments despite adversities from the high cost of sales and foreign exchange headwinds. Presence in diverse end markets, including construction, mining, aerospace, defense and food & beverage, helps the company offset weaknesses associated with a single market.

Growth in On-Road and Off-Road sales, supported by elevated levels of medium and heavy-duty equipment production is driving DCI’s Mobile Solutions segment’s revenues. Aftermarket sales are being aided by improved global supply-chain conditions. Sales growth in industrial filtration solutions and aerospace and defense is supporting the Industrial Solutions segment’s sales.

Acquired assets are strengthening DCI’s top line. Donaldson acquired Isolere Bio in February 2023, which enabled it to create leading separation and filtration solutions for emerging genetic-based drugs. Also, the acquisition of Purilogics, LLC (June 2022) strengthened the company’s life sciences portfolio by leveraging the acquired entity’s unique product offerings. The Solaris Biotechnology (in November 2021) buyout strengthened its presence across several end markets, including food and beverage, biopharma and other major life sciences.

Donaldson’s efforts to reward its shareholders through dividend payments and share repurchases are noteworthy. The company’s dividend payments totaled $110.1 million in fiscal 2022 and $56.2 million in the first six months of fiscal 2023. It also bought back shares worth $171 million in fiscal 2022 and $115.2 million in the first six months of fiscal 2023.

Donaldson Company, Inc. Price

Donaldson Company, Inc. Price
Donaldson Company, Inc. Price

Donaldson Company, Inc. price | Donaldson Company, Inc. Quote

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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’s earnings surprise in the last four quarters was 12.6%, on average. In the past 60 days, estimates for Ingersoll Rand’s 2023 earnings have increased 6%. The stock has rallied 5% in the past six months.

Alamo Group Inc. ALG presently sports a Zacks Rank of 1. ALG’s earnings surprise in the last four quarters was 17.7%, on average.

In the past 60 days, estimates for Alamo’s 2023 earnings have increased 12.7%. The stock has gained 17.5% in the past six months.

Parker-Hannifin Corporation PH presently carries a Zacks Rank #2 (Buy). The company delivered a trailing four-quarter earnings surprise of 12.4%, on average.

In the past 60 days, estimates for Parker-Hannifin’s fiscal 2023 (ending June 2023) earnings have increased 5.3%. The stock has gained 6.5% in the past six months.

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Parker-Hannifin Corporation (PH) : Free Stock Analysis 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

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