(DCI) - Donaldson Company, Inc - increased revenues for the past four years and expanded gross margins and grew profits for nine years running

Donaldson Company, Inc. (DCI) beat the Street's earnings estimate in four out of the past five quarters, most recently by 7.5%. On Sep 5, this Zacks #1 Rank stock reported record quarterly and full-year earnings per share, net income and revenues. Analysts have been upping their profit forecasts for fiscal 2007 and fiscal 2008. The Board of Directors raised its quarterly cash dividend by 12.5% in late July. DCI's return on equity nearly doubles that of the industry average—25% compared to 13%. Full Analysis Donaldson Company, Inc., through its subsidiaries, engages in the design, manufacture, and sale of filtration systems and replacement parts worldwide. The company serves customers in the industrial and engine markets, including dust collection, power generation, specialty filtration, compressed air purification, off-road equipment, industrial compressors, heavy trucks and light vehicles. DCI exceeded analysts' earnings expectations in four out of the past five quarters by an average margin of 6.0%. Moreover, the company beat or met estimates in six out of the past seven quarters. Earnings per share grew 12.9% over the past five years. The fourth quarter of fiscal 2006 marked all-time highs in earnings per share, net income and revenues for DCI. On Sep 5, the company reported fourth-quarter profits of 43 cents per share, compared to 39 cents per share in the prior-year period. The result amounted to a 7.5% positive surprise with analysts projecting 40 cents per share. Revenues came in at $468.2 million, up 10.8% versus $422.7 million in the fourth quarter of fiscal 2005. For the entire fiscal year, profits rose 19.6% to $132.3 million, while revenues jumped 6.1% to $1.694 billion, when compared to fiscal 2005. Earnings per share, net income and sales were also records for the full year. DCI increased revenues for the past four years and expanded gross margins and grew profits for nine years running. Earnings per share are forecasted to grow 12% over the next 3-5 years, in line with the expected growth rate of the industry. Chairman, President and CEO Bill Cook stated, “We are very pleased to announce another record year, and are especially pleased that we finished the year with solid sales growth and strong margin performance.” Fiscal 2006 represented the 17th straight record year for the company. DCI bought back 1,434,800 shares during the fourth quarter at a cost of $45.8 million. Throughout the entire year, the company repurchased 3,783,000 shares for $118.9 million. Consensus estimates for fiscal 2007 increased 5.4% to $1.77 over the past 60 days, and reflect upward revisions by three analysts. Profit forecasts for fiscal 2008 rose 5.0% to $1.89 over the past two months. One analyst upped his earnings estimate. On Jul 28, the Board of Directors boosted its quarterly cash dividend by 12.5% to nine cents per common share of stock from eight cents. The company has a current dividend yield of 0.96% and a five-year average dividend yield of 0.81%. DCI's return on equity nearly doubles that of the industry average—25% compared to 13%. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. | Blog Home| VitalStocks Home