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Why Donaldson (DCI) is a Top Value Stock for the Long-Term
ZACKS· 2025-06-11 14:46
Core Insights - Zacks Premium provides tools for investors to enhance their stock market engagement and confidence, including daily updates, research reports, and stock screens [1][2] Zacks Style Scores - Zacks Style Scores are indicators that assist investors in selecting stocks likely to outperform the market within 30 days, rated from A to F based on value, growth, and momentum characteristics [2][3] Value Score - The Value Style Score identifies stocks trading below their true value by analyzing ratios such as P/E, PEG, Price/Sales, and Price/Cash Flow [3] Growth Score - The Growth Style Score focuses on a company's financial health and future outlook, utilizing projected and historical earnings, sales, and cash flow to find stocks with sustainable growth [4] Momentum Score - The Momentum Style Score helps investors capitalize on price trends by assessing one-week price changes and monthly earnings estimate changes [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for stocks with attractive value, strong growth forecasts, and promising momentum [6] Zacks Rank - The Zacks Rank is a proprietary model that leverages earnings estimate revisions to guide investors in building successful portfolios [7] - Stocks rated 1 (Strong Buy) have historically produced an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [8] Stock to Watch: Donaldson Company, Inc. (DCI) - Donaldson Company, Inc. is a filtration systems manufacturer based in Bloomington, MN, with a Zacks Rank of 3 (Hold) and a VGM Score of A [12] - The company has a Value Style Score of B, supported by a forward P/E ratio of 19.31, indicating attractive valuation metrics [12] - Six analysts have raised their earnings estimates for fiscal 2025, with the Zacks Consensus Estimate increasing by $0.05 to $3.66 per share, and an average earnings surprise of 2.5% [13]
Here's Why Donaldson (DCI) is a Strong Momentum Stock
ZACKS· 2025-06-06 14:51
Core Insights - Zacks Premium provides tools for investors to enhance their stock market strategies, including daily updates on Zacks Rank and Industry Rank, research reports, and stock screens [1][2] Zacks Style Scores - Zacks Style Scores rate stocks based on value, growth, and momentum, serving as complementary indicators to the Zacks Rank, helping investors identify securities likely to outperform the market in the short term [2][3] - Stocks are rated from A to F, with A indicating the highest potential for outperformance [3] Value Score - The Value Style Score focuses on identifying undervalued stocks using financial ratios such as P/E, PEG, and Price/Cash Flow [3] Growth Score - The Growth Style Score assesses a company's financial health and future outlook by analyzing projected and historical earnings, sales, and cash flow [4] Momentum Score - The Momentum Style Score identifies optimal entry points for stocks based on price trends and earnings estimate changes [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for evaluating stocks based on value, growth, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary model that utilizes earnings estimate revisions to guide investors in building successful portfolios [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +25.41%, significantly outperforming the S&P 500 [8] Stock Selection Strategy - To maximize returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [10] - Stocks with a 3 (Hold) rank should also have Style Scores of A or B to ensure potential upside [10] Company Spotlight: Donaldson Company, Inc. - Donaldson Company, Inc. is a manufacturer of filtration systems and replacement parts, currently holding a Zacks Rank of 3 (Hold) with a VGM Score of B [12] - The company has a Momentum Style Score of A, with shares increasing by 3.3% over the past four weeks [12] - Recent analyst revisions have positively impacted earnings estimates for fiscal 2025, with the Zacks Consensus Estimate rising to $3.65 per share [13]
Here's Why You Should Avoid Investing in Donaldson Stock Right Now
ZACKS· 2025-05-12 11:50
Core Viewpoint - Donaldson Company, Inc. (DCI) is experiencing operational challenges due to weaknesses in both its off-road and on-road businesses, alongside rising expenses that are expected to impact earnings in the near future [1][5][6]. Business Performance - The on-road business has seen a sales decline of 24.4% year-over-year, primarily due to lower global truck production linked to softness in industrial markets [5]. - The off-road business has also been affected, with a sales decline of 12.8% year-over-year, driven by weak agricultural markets and soft global end-market demand [5]. Expense Trends - Selling, general and administrative expenses increased by 1.5% in the second quarter of fiscal 2025, attributed to rising headcount and costs from acquired businesses [6]. - Overall operating expenses rose by 3.9% year-over-year to $369.2 million in the first half of fiscal 2025, with operating expenses as a percentage of total revenues increasing by 30 basis points to 20.9% [6]. Foreign Exchange and Supply Chain Issues - DCI's international operations expose the company to economic, political, and environmental risks, as well as fluctuations in foreign currencies [7]. - Supply-chain disruptions could impact operations, as DCI relies on a variety of raw materials and components, necessitating price adjustments that may affect competitiveness [8].