Next Big Thing? Boomer Die-Off

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As the baby boom generation moves closer to leaving life's stage, some in younger generations can't disguise their pleasure.

The generation that inspired the me-generation label and the reaction "die yuppie scum" is starting to die.

Although generational stereotyping is nonsense (astrologists divide the living population into more types than generational analysis can), the economic effects are real.

The boomer die-off should be good for funeral services and casket makers. Yet, after the demographic bulge passes, isn't a drop-off likely?

Hillenbrand ( HI ), once known as a maker of caskets, urns and other memorial products, is in position to benefit from the rise in deaths and compensate for the subsequent drop.

The company has been using mergers and acquisitions to diversify.

In April 2010, the company merged with New Jersey-based K-Tron International, a company that makes and conveys bulk solids into the manufacturing process and also makes machines that cut raw materials.

In August 2011, Hillenbrand bought Cincinnati-based Rotex Global, a maker of dry material separation machines and replacement parts for a variety of industries.

In December 2012, Hillenbrand acquired Germany's Coperion Capital, a maker of material handling equipment.

The acquisitions have flipped Hillenbrand's revenue flow. In fiscal 2013 ended in September, the processing equipment group accounted for 60% of revenue, surpassing the Batesville death-care segment for the first time.

More than 40% of total revenue is now from outside the U.S. Analysts expect fiscal 2014 earnings to grow 14% on a 12% revenue pop.

The company reported quarterly results Monday, missing on earnings and revenue because of weakness in potash and proppants markets and strength in cremation.

The annualized dividend yield is 2.8%.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Personal Finance , Investing Ideas

Referenced Stocks: HI

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