Donaldson (DCI) & Its Competitors Head to Head Review

Donaldson (NYSE:DCI) is one of 436 publicly-traded companies in the “Machinery” industry, but how does it weigh in compared to its competitors? We will compare Donaldson to similar companies based on the strength of its risk, valuation, earnings, institutional ownership, profitability, analyst recommendations and dividends.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Donaldson and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Donaldson	0	2	3	0	2.60
Donaldson Competitors	4214	14730	18258	809	2.41

Donaldson presently has a consensus price target of $101.67, indicating a potential upside of 16.85%. As a group, “Machinery” companies have a potential upside of 30.46%. Given Donaldson’s competitors higher probable upside, analysts clearly believe Donaldson has less favorable growth aspects than its competitors.

Dividends

Donaldson pays an annual dividend of $1.28 per share and has a dividend yield of 1.5%. Donaldson pays out 33.2% of its earnings in the form of a dividend. As a group, “Machinery” companies pay a dividend yield of 2.8% and pay out 24.6% of their earnings in the form of a dividend. Donaldson has increased its dividend for 38 consecutive years. Donaldson lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Volatility & Risk

Donaldson has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Donaldson’s competitors have a beta of 5.12, indicating that their average share price is 412% more volatile than the S&P 500.

Earnings & Valuation

This table compares Donaldson and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Donaldson	$3.89 billion	$453.80 million	22.60
Donaldson Competitors	$4.78 billion	$361.11 million	6.35

Donaldson’s competitors have higher revenue, but lower earnings than Donaldson. Donaldson is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Donaldson and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Donaldson	11.68%	28.68%	14.27%
Donaldson Competitors	-1,035.51%	-36.25%	-0.27%

Insider and Institutional Ownership

82.8% of Donaldson shares are owned by institutional investors. Comparatively, 51.8% of shares of all “Machinery” companies are owned by institutional investors. 2.2% of Donaldson shares are owned by company insiders. Comparatively, 14.1% of shares of all “Machinery” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Donaldson beats its competitors on 8 of the 15 factors compared.

About Donaldson

Donaldson Company, Inc. is a global manufacturer of filtration systems and replacement parts. Founded in 1915, the company serves customers in industries including agriculture, construction, mining, transportation, manufacturing, and life sciences. Its products include air, liquid, fuel, and lubricating-oil filters for engines and equipment, as well as dust-collection systems and filtration solutions for compressed air and gas. Donaldson also provides filtration technologies for applications such as food and beverage production, bioprocessing, and other life sciences uses.