Why Middleby Is Poised to Keep Poppin'
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, food service equipment specialist has earned a respected four-star ranking.
With that in mind, let's take a closer look at Middleby and see what CAPS investors are saying about the stock right now.
Middleby facts
Headquarters (founded) | Elgin, Ill. (1888) |
Market Cap | $2.7 billion |
Industry | Industrial machinery |
Trailing-12-Month Revenue | $1.0 billion |
Management | Chairman/CEO Selim Bassoul CFO Timothy FitzGerald |
20.1% | |
Cash/Debt | $34.4 million / $262.9 million |
Competitors | FMC Technologies Illinois Tool Works Manitowoc |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 96% of the 2,529 members who have rated Middleby believe the stock will outperform the S&P 500 going forward.
Just yesterday, one of those Fools, TMFInnovator, offered a balanced take on the opportunity:
- Middleby benefits from brand recognition and trust of the quality of their products.
-Once they get established with commercial restaurants at the account level, they benefit as the chain continues to expand. For example, Papa John's uses only Middleby's ovens in all of the new locations it opens. This is easy $$for Middleby, as long as they can keep up with demand and keep the customer relationship.
-They are in an industry that doesn't naturally attract disruptors. I'm not aware of any Harvard Business School MBA's that are itching to mix things up in commercial kitchens.The biggest risks I can identify are:
-Huge amount of goodwill on their balance sheet as a result of their acquisitions. Goodwill was 42% of total assets last year ... before the Viking purchase was even counted.
-They do not have established know-how in consumer sales. Will MIDD be able to successfully sell high-end commercial kitchens to homeowners?Selim Bassoul is a CEO that's worth betting on. I think Middleby is a long-term outperformer.
If you want market-thumping returns, you need to put together the best portfolio you can. Of course, despite a strong four-star rating, Middleby may not be your top choice.
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The article Why Middleby Is Poised to Keep Poppin' originally appeared on Fool.com.
Motley Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends FMC Technologies, Illinois Tool Works, and Middleby. The Motley Fool owns shares of Middleby. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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