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Donaldson (DCI) Completes Acquisition of 49% Stake in Medica
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Donaldson Company, Inc. (DCI - Free Report) has recently completed the acquisition of a 49% minority stake in Medica S.p.A. for €62 million ($67.73 million) which excludes transaction-related fees and expenses. This deal was announced in April 2024.
Based in the biomedical district of Mirandola, Italy, Medica is engaged in producing hollow fiber membrane filtration products used for blood purification in numerous applications including dialysis, continuous renal replacement therapies and therapeutic apheresis. Its products and technologies are also used in the microbiological purification of water and automation solutions for disposable medical device manufacturing.
Acquisition Rationale
This acquisition is in sync with DCI’s policy of acquiring businesses to strengthen its business and expand its product portfolio and market share. The inclusion of Medica’s technology and expertise in filtration products will offer growth opportunities to Donaldson. It will enable DCI to penetrate new markets and diversify its offerings in the medical device and water purification sectors.
On a separate note, in June 2023, the company acquired Univercells Technologies, thereby expanding its growing offerings in the life sciences industry. Univercells was added to the Life Sciences segment.
Donaldson acquired Isolere Bio in February 2023. The Isolere buyout enabled the creation of leading separation and filtration solutions for emerging genetic-based drugs. Isolere’s revenues are reported within the Life Sciences segment.
Zacks Rank and Price Performance
DCI currently carries a Zacks Rank #3 (Hold).
Donaldson is well-positioned to benefit from the solid momentum across its segments. Solid momentum in the aftermarket business, driven by market share gains and pricing benefits, is driving the Mobile Solutions segment.
However, softness in off-road and on-road businesses is concerning for the company. Rising selling, general and administrative expenses, owing to increasing headcount and incremental expenses, are expected to weigh on its bottom line in the near term.
In the past year, the stock has gained 13.5% compared with the industry’s 23.6% growth.
ATMU delivered a trailing four-quarter average earnings surprise of 13.4%. In the past 60 days, the Zacks Consensus Estimate for Atmus’ 2024 earnings has increased 3.1%.
Tetra Tech, Inc. (TTEK - Free Report) presently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 9.5%.
In the past 60 days, the consensus estimate for TTEK’s fiscal 2024 earnings has increased 0.7%.
Allegion plc (ALLE - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 10.3%.
The Zacks Consensus Estimate for ALLE’s 2024 earnings has increased 1.1% in the past 60 days.
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Donaldson (DCI) Completes Acquisition of 49% Stake in Medica
Donaldson Company, Inc. (DCI - Free Report) has recently completed the acquisition of a 49% minority stake in Medica S.p.A. for €62 million ($67.73 million) which excludes transaction-related fees and expenses. This deal was announced in April 2024.
Based in the biomedical district of Mirandola, Italy, Medica is engaged in producing hollow fiber membrane filtration products used for blood purification in numerous applications including dialysis, continuous renal replacement therapies and therapeutic apheresis. Its products and technologies are also used in the microbiological purification of water and automation solutions for disposable medical device manufacturing.
Acquisition Rationale
This acquisition is in sync with DCI’s policy of acquiring businesses to strengthen its business and expand its product portfolio and market share. The inclusion of Medica’s technology and expertise in filtration products will offer growth opportunities to Donaldson. It will enable DCI to penetrate new markets and diversify its offerings in the medical device and water purification sectors.
On a separate note, in June 2023, the company acquired Univercells Technologies, thereby expanding its growing offerings in the life sciences industry. Univercells was added to the Life Sciences segment.
Donaldson acquired Isolere Bio in February 2023. The Isolere buyout enabled the creation of leading separation and filtration solutions for emerging genetic-based drugs. Isolere’s revenues are reported within the Life Sciences segment.
Zacks Rank and Price Performance
DCI currently carries a Zacks Rank #3 (Hold).
Donaldson is well-positioned to benefit from the solid momentum across its segments. Solid momentum in the aftermarket business, driven by market share gains and pricing benefits, is driving the Mobile Solutions segment.
However, softness in off-road and on-road businesses is concerning for the company. Rising selling, general and administrative expenses, owing to increasing headcount and incremental expenses, are expected to weigh on its bottom line in the near term.
In the past year, the stock has gained 13.5% compared with the industry’s 23.6% growth.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies are discussed below.
Atmus Filtration Technologies Inc. (ATMU - Free Report) currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ATMU delivered a trailing four-quarter average earnings surprise of 13.4%. In the past 60 days, the Zacks Consensus Estimate for Atmus’ 2024 earnings has increased 3.1%.
Tetra Tech, Inc. (TTEK - Free Report) presently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 9.5%.
In the past 60 days, the consensus estimate for TTEK’s fiscal 2024 earnings has increased 0.7%.
Allegion plc (ALLE - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 10.3%.
The Zacks Consensus Estimate for ALLE’s 2024 earnings has increased 1.1% in the past 60 days.