Download PDF

1. Company Snapshot

1.a. Company Description

Donaldson Company, Inc.manufactures and sells filtration systems and replacement parts worldwide.The company operates through two segments, Engine Products and Industrial Products.


Its Engine Products segment provides replacement filters for air and liquid filtration applications; air filtration systems; liquid filtration systems for fuel, lube, and hydraulic applications; exhaust and emissions systems and sensors; indicators; and monitoring systems.This segment sells its products to original equipment manufacturers (OEMs) in the construction, mining, agriculture, aerospace, defense, and transportation markets; and to independent distributors, OEM dealer networks, private label accounts, and large fleets.The company's Industrial Products segment offers dust, fume, and mist collectors; compressed air purification systems; gas and liquid filtration for food, beverage, and industrial processes; air filtration systems for gas turbines; polytetrafluoroethylene membrane-based products; and specialized air and gas filtration systems for applications, including hard disk drives, semi-conductor manufacturing and sensors, indicators, and monitoring systems.


This segment sells its products to various dealers, distributors, OEMs of gas-fired turbines, and OEMs and end-users requiring air filtration solutions and replacement filters.Donaldson Company, Inc.was founded in 1915 and is headquartered in Bloomington, Minnesota.

Show Full description

1.b. Last Insights on DCI

Breaking News: Donaldson Company Inc reported Q1 earnings on December 4 2025. The company posted earnings of $0.94 per share beating the Zacks Consensus Estimate of $0.93 per share. This represents a year-over-year increase from $0.83 per share. Revenue and EPS exceeded Wall Street estimates. The company's Q1 performance appears strong. Zacks analyst recommends a hold. Other analysts at Deutsche Bank and Wells Fargo have a hold and a buy rating respectively. RBC Capital Markets give a sector perform rating.

1.c. Company Highlights

2. Donaldson Company's Q1 FY2026 Earnings: Strong Performance and Upward Guidance Revision

Donaldson Company's first quarter Fiscal 2026 results were impressive, with sales reaching $935 million, a 4% year-over-year increase driven by growth in mobile aftermarket, power generation, food and beverage, and disk drive. The company's operating profit margin expanded to a record 15.5%, and earnings per share reached a record 94¢, 13% above the prior year, beating analyst estimates of $0.923. The company returned $127 million to shareholders through share repurchase and dividends.

Publication Date: Dec -07

📋 Highlights
  • Strong Q1 Performance:: Sales rose to $935 million (+4% YoY), with record operating margin of 15.5% and EPS of 94¢ (+13% YoY).
  • Shareholder Returns:: $127 million returned via share repurchases and dividends, reflecting disciplined capital allocation.
  • Revised Fiscal 2026 Outlook:: Sales guided to $3.8 billion, 16.5% operating margin, and $4.03 EPS (up from prior guidance).
  • Segment Growth Drivers:: Life sciences up 13% YoY (food, beverage, disk drive), mobile solutions sales +5% YoY (aftermarket +7%), and power generation with full order books.

Segment-wise Performance

In mobile solutions, sales were $598 million, up 5% year-over-year, with aftermarket sales growing 7%. First fit sales also increased, led by off-road growth. Industrial solutions sales were $258 million, flat to the prior year, with industrial filtration solutions sales growing 2%. Life sciences sales grew 13% year-over-year, driven by double-digit growth in food and beverage and disk drive. As noted by Todd Carpenter, "we have a strong diversified portfolio of businesses... we're winning share gains in areas like aftermarket, industrial, mobile solutions, and life sciences."

Guidance and Outlook

The company is increasing its operating margin and EPS outlook for Fiscal 2026, expecting record sales of $3.8 billion, operating margin expansion of 80 basis points to 16.5%, and all-time high earnings per share of $4.03. Segment-wise, mobile solutions sales are expected to be flat to up 4%, industrial solutions sales to grow 2-6%, and life sciences sales to grow 1-5%. The company expects to benefit from pricing, cost optimization initiatives, and structural efficiencies.

Valuation

With a P/E Ratio of 28.05 and an EV/EBITDA of 18.52, the market is pricing in a certain level of growth. Analysts estimate next year's revenue growth at 4.3%. The company's ROIC is 16.57%, and ROE is 25.55%, indicating a strong return on capital. The dividend yield is 1.27%, providing a relatively stable income stream.

Growth Drivers

The disk drive business is seeing strength driven by AI and cloud-based storage, and is expected to continue growing. The data center opportunity is expected to materially impact the business, with opportunities in power generation, microelectronics, and cooling. The company expects mid-single-digit growth in the power generation business, driven by complex projects and ramp-up challenges.

3. NewsRoom

Card image cap

Donaldson's Q1 Earnings & Revenues Beat Estimates, Increase Y/Y

Dec -05

Source: zacks.com

Card image cap

Donaldson Analysts Boost Their Forecasts Following Strong Q1 Earnings

Dec -05

Source: benzinga.com

Card image cap

Donaldson Company, Inc. (DCI) Q1 2026 Earnings Call Transcript

Dec -04

Source: seekingalpha.com

Card image cap

Donaldson (DCI) Q1 Earnings: How Key Metrics Compare to Wall Street Estimates

Dec -04

Source: zacks.com

Card image cap

Donaldson (DCI) Surpasses Q1 Earnings and Revenue Estimates

Dec -04

Source: zacks.com

Card image cap

What Analyst Projections for Key Metrics Reveal About Donaldson (DCI) Q1 Earnings

Dec -01

Source: zacks.com

Card image cap

Capital Counsel LLC NY Sells 3,796 Shares of Donaldson Company, Inc. $DCI

Dec -01

Source: defenseworld.net

Card image cap

34,860 Shares in Donaldson Company, Inc. $DCI Acquired by Ballast Asset Management LP

Dec -01

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.57%)

6. Segments

Mobile Solutions

Expected Growth: 5.5%

Donaldson's Mobile Solutions segment growth of 5.5% is driven by increasing adoption of clean air and fuel filtration systems in the automotive and industrial markets, coupled with rising demand for efficient filtration solutions in the oil and gas industry. Additionally, the company's strategic investments in digital technologies and expansion into emerging markets are contributing to the segment's growth.

Industrial Solutions

Expected Growth: 5.8%

Donaldson's Industrial Solutions segment growth of 5.8% is driven by increasing demand for filtration solutions in industrial processes, expansion in emerging markets, and strategic acquisitions. Additionally, the segment benefits from the company's focus on innovation, product diversification, and strong customer relationships, leading to market share gains and revenue growth.

Life Sciences

Expected Growth: 5.2%

Donaldson's Life Sciences segment growth of 5.2% is driven by increasing demand for bioprocessing and pharmaceutical products, expansion in emerging markets, and strategic acquisitions. Additionally, the company's innovative filtration solutions and strong relationships with key customers contribute to its growth momentum.

7. Detailed Products

Air Filtration Products

Donaldson's air filtration products are designed to capture contaminants and pollutants from the air, providing clean air for various industries such as industrial, commercial, and residential applications.

Liquid Filtration Products

Donaldson's liquid filtration products are designed to remove contaminants and impurities from liquids, providing clean fluids for various industries such as oil and gas, chemical processing, and power generation.

Gas Turbine Filtration Products

Donaldson's gas turbine filtration products are designed to provide clean air for gas turbines, improving efficiency and reducing downtime.

Dust Collection Products

Donaldson's dust collection products are designed to capture dust and other airborne contaminants, providing a cleaner and safer work environment.

Hydraulic Filtration Products

Donaldson's hydraulic filtration products are designed to remove contaminants and impurities from hydraulic fluids, improving system performance and reducing downtime.

Process Filtration Products

Donaldson's process filtration products are designed to remove contaminants and impurities from process fluids, improving product quality and reducing waste.

8. Donaldson Company, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Donaldson Company, Inc. is medium due to the availability of alternative products in the market.

Bargaining Power Of Customers

The bargaining power of customers is high due to the presence of large and established customers who can negotiate prices and terms.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the company's ability to negotiate prices and terms with its suppliers.

Threat Of New Entrants

The threat of new entrants is medium due to the moderate barriers to entry in the industry.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established competitors in the market.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 33.18%
Debt Cost 3.95%
Equity Weight 66.82%
Equity Cost 9.39%
WACC 7.58%
Leverage 49.65%

11. Quality Control: Donaldson Company, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Watts Water Technologies

A-Score: 5.9/10

Value: 2.4

Growth: 6.9

Quality: 8.0

Yield: 1.0

Momentum: 8.0

Volatility: 9.0

1-Year Total Return ->

View Full Report
Stock-Card
Donaldson

A-Score: 5.6/10

Value: 2.6

Growth: 5.8

Quality: 6.7

Yield: 2.0

Momentum: 7.0

Volatility: 9.3

1-Year Total Return ->

View Full Report
Stock-Card
A O Smith

A-Score: 5.6/10

Value: 3.9

Growth: 5.8

Quality: 8.0

Yield: 4.0

Momentum: 3.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
ITT

A-Score: 5.4/10

Value: 2.4

Growth: 6.7

Quality: 7.2

Yield: 2.0

Momentum: 7.0

Volatility: 7.3

1-Year Total Return ->

View Full Report
Stock-Card
CSW Industrials

A-Score: 4.9/10

Value: 2.4

Growth: 8.2

Quality: 7.9

Yield: 0.0

Momentum: 2.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
Nordson

A-Score: 4.7/10

Value: 2.4

Growth: 5.0

Quality: 6.8

Yield: 2.0

Momentum: 3.0

Volatility: 8.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

90.16$

Current Price

90.16$

Potential

-0.00%

Expected Cash-Flows