Donaldson Company (DCI) AI Stock Analysis

• Market Cap: $10.64B
• Dividend Yield: 1.27%
• Average Volume (3M): 708.42K
• Price to Earnings (P/E): 28.8
• Beta (1Y): 0.79
• Revenue Growth: 2.37%
• EPS Growth: -6.93%
• Country: US
• Employees: 14,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 0.94
• Shares Outstanding: 115,336,685
• 10 Day Avg. Volume: 839,631
• 30 Day Avg. Volume: 708,417
• PEG Ratio: -2.35
• Price to Book (P/B): 5.88
• Price to Sales (P/S): 2.31
• P/FCF Ratio: 25.13
• Enterprise Value/Market Cap: 0.98
• Enterprise Value/Revenue: 2.79
• Enterprise Value/Gross Profit: 8.02
• Enterprise Value/Ebitda: 16.41
• 1Y Price Target: $96.33
• Price Target Upside: 4.40% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: $100.00 ▲(8.38% Upside)

Donaldson Company's strong financial performance and positive earnings call are the most significant factors driving the stock score. The technical analysis supports a positive trend, while the valuation indicates the stock may be overvalued. Despite some challenges, the company's strategic initiatives and robust cash generation contribute to a favorable outlook.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective sales strategies, supporting long-term business expansion.

Cash Generation

Robust cash generation enhances financial flexibility, allowing for reinvestment in growth opportunities and shareholder returns.

Market Position

Strengthening market position through increased sales and market share solidifies competitive advantage and future revenue potential.

Negative Factors

On-Road Sales Decline

Significant decline in on-road sales could impact overall revenue and market presence in the automotive sector.

Profit Margin Pressure

Decreasing net profit margins may indicate rising costs or pricing pressures, potentially affecting long-term profitability.

Industrial Solutions Profit Decline

Declining margins in industrial solutions suggest challenges in cost management and sales mix, impacting segment profitability.

Donaldson Company Business Overview & Revenue Model

Company Description

Donaldson Company, Inc. (DCI) is a global leader in providing filtration systems and replacement parts. Founded in 1915, the company operates primarily in the industrial, engine, and aerospace sectors. DCI designs and manufactures a wide range of filtration solutions, including air, liquid, and fuel filtration systems, as well as exhaust and emission systems. Their products serve diverse industries such as agriculture, construction, mining, and transportation, ensuring cleaner air and fluid management for improved operational efficiency.

How the Company Makes Money

Donaldson Company generates revenue primarily through the sale of filtration products and systems. Its revenue model is based on two main segments: Engine Products and Industrial Products. The Engine Products segment focuses on filtration solutions for internal combustion engines, including those used in heavy-duty vehicles and equipment, which contributes significantly to overall sales. The Industrial Products segment offers a variety of filtration solutions for industrial processes, including dust collection and process filtration systems. Key revenue streams include direct sales, replacement parts, and aftermarket services. DCI also engages in strategic partnerships with original equipment manufacturers (OEMs) and distributors, expanding its market reach and enhancing its product offerings. Additionally, the company benefits from a recurring revenue model through aftermarket sales, as customers often return for replacement filters and maintenance services.

Donaldson Company Financial Statement Overview

Summary

Donaldson Company exhibits strong financial health with consistent revenue growth and efficient operations. The balance sheet reflects a balanced leverage strategy, while cash flow metrics indicate robust cash generation. However, careful monitoring of profitability margins and debt levels is advisable.

Income Statement

Donaldson Company demonstrates strong revenue growth with a TTM increase of 9.56%, indicating robust demand for its products. The gross profit margin remains stable at approximately 34.85%, reflecting efficient cost management. However, the net profit margin has slightly decreased over time, currently at 9.94%, suggesting some pressure on profitability. Overall, the company maintains healthy EBIT and EBITDA margins, showcasing operational efficiency.

Balance Sheet

The company maintains a moderate debt-to-equity ratio of 0.46, indicating a balanced approach to leveraging. Return on equity is strong at 24.45%, reflecting effective use of shareholder funds. The equity ratio stands at 50.12%, suggesting a solid capital structure. However, the slight increase in total debt over the periods warrants monitoring.

Cash Flow

Donaldson Company shows a positive trend in free cash flow growth at 18.62% TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is stable at 0.55, suggesting efficient cash conversion. The free cash flow to net income ratio of 0.81 further supports the company's ability to generate cash relative to its earnings.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.69B	3.59B	3.43B	3.31B	2.85B
Gross Profit	1.29B	1.27B	1.16B	1.07B	971.70M
EBITDA	615.90M	655.10M	580.20M	547.60M	489.30M
Net Income	367.00M	414.00M	358.80M	332.80M	286.90M
Balance Sheet
Total Assets	2.98B	2.91B	2.77B	2.60B	2.40B
Cash, Cash Equivalents and Short-Term Investments	180.40M	232.70M	187.10M	193.30M	222.80M
Total Debt	730.20M	598.20M	655.70M	692.80M	527.60M
Total Liabilities	1.52B	1.43B	1.45B	1.47B	1.26B
Stockholders Equity	1.45B	1.49B	1.32B	1.13B	1.14B
Cash Flow
Free Cash Flow	339.90M	406.90M	426.40M	167.70M	343.60M
Operating Cash Flow	418.80M	492.50M	544.50M	252.80M	401.90M
Investing Cash Flow	-150.40M	-86.90M	-327.30M	-154.00M	-58.30M
Financing Cash Flow	-321.70M	-355.90M	-222.20M	-114.20M	-363.30M

Donaldson Company Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 92.27
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DCI, the sentiment is Positive. The current price of 92.27 is above the 20-day moving average (MA) of 88.94, above the 50-day MA of 85.72, and above the 200-day MA of 74.32, indicating a bullish trend. The MACD of 1.99 indicates Negative momentum. The RSI at 61.48 is Neutral, neither overbought nor oversold. The STOCH value of 69.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DCI.

Donaldson Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DCI	79 Outperform	$10.64B	28.79	24.96%	1.27%	2.37%	-6.93%
AOS	77 Outperform	$9.57B	18.55	28.21%	2.01%	-1.64%	-2.50%
SPXC	77 Outperform	$10.96B	46.92	12.76%	―	12.60%	24.02%
WTS	77 Outperform	$9.31B	28.81	17.81%	0.71%	4.18%	16.05%
RRX	69 Neutral	$9.97B	38.84	3.89%	0.93%	-4.99%	22.16%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
GNRC	59 Neutral	$9.43B	30.60	12.38%	―	5.52%	9.03%

Donaldson Company Corporate Events

Donaldson Company Holds Annual Stockholders Meeting

On November 21, 2025, Donaldson Company, Inc. held its Annual Meeting of Stockholders, where key decisions were made. Stockholders elected four individuals to the Board of Directors, approved a non-binding advisory vote on executive compensation, and ratified the appointment of PricewaterhouseCoopers LLP as the independent auditor for the fiscal year ending July 31, 2026. These decisions are crucial for the company’s governance and financial oversight, impacting its strategic direction and stakeholder confidence.