Donaldson Co manufactures filtration systems and replacements parts including air and liquid filters, exhaust and emission control products, in-plant air cleaning systems, air purification systems, intake systems and specialized filters. The company has grown profits and dividends at a 13-15% pace over the last 10 years earning an 19-25% return on equity. As with most industrial equipment suppliers 2009 was a tough year. However, the company has returned to its above average rate of earnings growth as a result of:
(1) expansion into emerging markets,
(2) the introduction of new products through technological innovation,
(3) improved productivity coming from a comprehensive cost rationalization program.
(1) faltering demand in several of its end markets,
(2) rising raw material costs.
Stock Dividend Payout # Increases
Yield Growth Rate Ratio Since 2003
Debt/ EPS Down Net Value Line
Equity ROE Since 2003 Margin Rating
DCI stock made good progress off its March
2009 low, quickly surpassing the downtrend off its June 2008 high (straight red
line) and the November 2008 trading high (green line). Long term, the stock is in an uptrend (blue
lines). Intermediate term, it is in a
trading range (purple lines). The wiggly
red line is the 50 day moving average.
The Aggressive Growth Portfolio owns a full position in DCI. The upper boundary of its
is $33; the lower boundary of its Buy
is $47. Sell