Donaldson (NYSE:DCI) Lowered to “Hold” at Zacks Investment Research

Zacks Investment Research downgraded shares of Donaldson (NYSE:DCI) from a buy rating to a hold rating in a research note published on Friday, March 9th.

According to Zacks, “Donaldson has a choppy earnings surprise history, having beaten estimates twice in the trailing four quarters for as many beats. Donaldson’s Engine Products segment has been showing great momentum, benefiting from strength in original equipment business, stabilization in market conditions and robust sales of replacement parts. A rebound in heavy duty truck production, past and new program wins and strong demand in the massive Chinese market are adding to Donaldson’s growth. However, on the flip side, the company’s operations remain vulnerable to weakness in the gas turbine market. Also, Donaldson’s gross margins are being compressed due to inflation, which is affecting the outlay on wages and raw materials like steel. Over the past year, the company’s shares have underperformed the industry average.”

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A number of other analysts also recently weighed in on the stock. Jefferies Group reissued a buy rating and set a $57.00 price target on shares of Donaldson in a research report on Friday, December 1st. Gabelli raised shares of Donaldson from a neutral rating to a buy rating in a research report on Wednesday, March 7th. They noted that the move was a valuation call. TheStreet cut Donaldson from an a- rating to a c+ rating in a research note on Tuesday, March 6th. Stifel Nicolaus reduced their price objective on Donaldson from $53.00 to $51.00 and set a hold rating on the stock in a research note on Wednesday, March 7th. Finally, Oppenheimer restated a hold rating on shares of Donaldson in a research note on Monday, December 18th. Five research analysts have rated the stock with a hold rating and four have assigned a buy rating to the company’s stock. The stock presently has an average rating of Hold and a consensus target price of $51.00.

DCI traded down $1.41 on Friday, reaching $43.64. 425,534 shares of the company’s stock were exchanged, compared to its average volume of 516,880. The company has a market cap of $5,852.34, a PE ratio of 24.35, a price-to-earnings-growth ratio of 2.05 and a beta of 1.14. Donaldson has a twelve month low of $42.59 and a twelve month high of $52.20. The company has a debt-to-equity ratio of 0.81, a quick ratio of 2.15 and a current ratio of 2.94.

Donaldson (NYSE:DCI) last issued its quarterly earnings data on Tuesday, March 6th. The industrial products company reported $0.43 earnings per share (EPS) for the quarter, missing the Thomson Reuters’ consensus estimate of $0.44 by ($0.01). Donaldson had a net margin of 5.29% and a return on equity of 29.25%. The firm had revenue of $664.70 million during the quarter, compared to analyst estimates of $630.53 million. During the same period last year, the business earned $0.35 EPS. The firm’s revenue was up 20.7% compared to the same quarter last year. sell-side analysts predict that Donaldson will post 1.98 earnings per share for the current year.

The business also recently disclosed a quarterly dividend, which was paid on Tuesday, March 6th. Investors of record on Wednesday, February 14th were paid a dividend of $0.18 per share. This represents a $0.72 dividend on an annualized basis and a dividend yield of 1.65%. The ex-dividend date of this dividend was Tuesday, February 13th. Donaldson’s dividend payout ratio is currently 42.60%.

Hedge funds and other institutional investors have recently modified their holdings of the stock. Zurcher Kantonalbank Zurich Cantonalbank raised its stake in shares of Donaldson by 44.8% during the fourth quarter. Zurcher Kantonalbank Zurich Cantonalbank now owns 6,794 shares of the industrial products company’s stock valued at $333,000 after purchasing an additional 2,102 shares in the last quarter. Somerville Kurt F acquired a new position in Donaldson during the fourth quarter worth about $472,000. California Public Employees Retirement System grew its holdings in Donaldson by 4.0% during the fourth quarter. California Public Employees Retirement System now owns 319,328 shares of the industrial products company’s stock worth $15,631,000 after acquiring an additional 12,155 shares during the period. JPMorgan Chase & Co. grew its holdings in Donaldson by 394.0% during the third quarter. JPMorgan Chase & Co. now owns 158,182 shares of the industrial products company’s stock worth $7,278,000 after acquiring an additional 126,161 shares during the period. Finally, Dimensional Fund Advisors LP grew its holdings in Donaldson by 7.5% during the third quarter. Dimensional Fund Advisors LP now owns 877,588 shares of the industrial products company’s stock worth $40,317,000 after acquiring an additional 61,371 shares during the period. Institutional investors and hedge funds own 79.15% of the company’s stock.

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Donaldson Company Profile

Donaldson Company, Inc is a manufacturer of filtration systems and replacement parts. The Company’s segments include Engine Products, Industrial Products and Corporate. The Company’s products are manufactured at approximately 44 plants around the world and through three joint ventures. The Company offers its products under the Ultra-Web, PowerCore and Donaldson brands.

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