Middleby (MIDD) Eyes Growth On Buyouts, Headwinds Linger
Zacks Investment Research | Nov 09, 2017 08:40PM ET
We issued an updated research report on premium diversified machinery company The Middleby Corporation (NASDAQ:MIDD) on Nov 10.
Existing Scenario
Middleby is currently following an acquisition-based growth strategy. In third-quarter 2017, the company generated $28.6 million sales from its recent business buyouts. In this context, the company’s QualServ buyout (closed in August 2017) and Globe acquisition (closed in October 2017) are worth mentioning. Both are expected to bolster revenues of its Commercial Foodservice Equipment Group in the near term. Also, the Burford (May 2017) and CVP Systems (June 2017) buyouts will likely improve the near-term revenues of the company’s Food Processing Equipment segment.
Moreover, the company believes its latest production expansion moves as well as efforts taken to upgrade the existing plants and develop new manufacturing facilities in emerging markets will drive its top-line performance in the near term.
Middleby also intends to boost its near-term competency in the global foodservice equipment industry, backed by its innovation investments. For instance, products launched under the Viking brand are anticipated to secure sturdy response from the end markets. Moreover, opening of the two residential Viking brand centers in Chicago and New York will be beneficial, as the company will display its recently unveiled products in the same.
However, we notice that over the last three months, shares of this Zacks Rank #3 (Hold) stock have lost 11.3%, as against 10.3% growth recorded by the Original post
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