) recently updated its outlook for fiscal 2012 and 2013 and
highlighted its growth initiatives for the next three years.
Dover has trimmed its fiscal 2012 EPS guidance to a range of
$4.36 to $4.46 from the earlier guidance of $4.55-$4.65 per
share. The reduction of 19 cents stems from an 18 cents reduction
from discontinuing non-core businesses, 2 cents pertaining to
cost related to the recent Anthony acquisition, offset by a 1
cent accretion from share repurchase activity in the fourth
Compared with the prior-year adjusted earnings of $4.46 per
share, fiscal 2012 guidance represents an annual growth of 2% to
5%. Revenue is expected to be around $8.1 billion for the
The company has also initiated guidance for fiscal 2013 with
earnings in the range of $5.05 to $5.35 per share. The midpoint
of fiscal 2013 guidance stands at $5.20 per share, up 18% from
the fiscal 2012 guidance's midpoint of $4.41.
The guidance is based on organic revenue growth of 3% to 5%
and acquisition growth of 4%, leading to full-year revenue growth
of 7% to 9%. Segment margin is expected to expand 30 to 70 basis
points from 2012, driven by productivity benefits and continued
The company is committed to achieving its targeted annual
organic sales growth of 4% to 6% in the next three years, aided
by accretive acquisitions. Including the Anthony acquisition,
growth rate is expected to be 5-7%. The company continues to
focus on its five key growth spaces - communication components,
energy, product ID, refrigeration and food equipment, and fluid
In 2012, these areas contributed to 77% of Dover's revenue and
79% of operating earnings. The company expects to deliver segment
margin expansion of 50 basis points annually. Free cash flow is
expected to be around 10% of revenues and projected to reach the
$1 billion mark in 2015.
The company also remains committed to returning cash to its
shareholders through dividends and share buybacks. The company
has a commendable record of raising dividends for the last 57
Dover recently announced that its board has authorized an
additional $1 billion share repurchase program to be completed
over the next 12 to 18 months. Dover also announced its intent to
divest certain non-core businesses, which cater to the electronic
assembly and test markets.
Dover recently acquired Anthony International - a manufacturer
of glass doors for commercial refrigerators - for $602.5 million.
The acquisition will expand Dover's product portfolio and enhance
its service offerings. Dover will also be able to leverage
Anthony's geographic footprint to grow its international
The acquisition adds significantly to its Engineered Systems
portfolio. In addition, growth initiatives and new product
offerings in the Fluids and Refrigeration spaces will add to the
growth profile of the Engineered Systems segment.
In the Communication Technologies segment, rising demand among
customers for improved audio products in their mobile devices
provide significant opportunities for growth and new market
penetration. In the Energy segment, the company sees significant
opportunities to expand globally in production and downstream
offerings. New product launches, expansion of core businesses and
printing positions will help drive growth in the Printing &
New York-based Dover is an industrial conglomerate producing a
wide range of specialized industrial products and manufacturing
equipment. Dover competes with companies like
Cooper Industries plc
Weatherford International Ltd.
). The company retains a short-term Zacks #3 Rank (Hold).
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