Donaldson Company, Inc. DCI
Donaldson just reported record FY2026 results with full-year GAAP net earnings of $453.8M (up from $367.0M in FY2025) and EPS of $3.85 (up from $3.05), decisively reversing the prior year's 11.35% net income decline and validating the Facet Filtration acquisition thesis. The stock trades at a 24.1% P/E discount to the industrial-machinery peer median (23.79x vs. 31.34x) and a modest EV/EBITDA discount (17.23x vs. 17.99x), leaving room for multiple expansion alongside earnings growth.
Net insider buying of roughly 242K shares over 24 months, a new BlackRock 10.30% stake, and an expanding institutional base (51 funds as of 2026-06-30 vs. 42 a year earlier) reinforce the constructive setup. With the earnings inflection now confirmed, the risk/reward favors accumulation.
What could go wrong
- Industrial Solutions weakness. Zacks noted persistent headwinds in Industrial Solutions despite Mobile Solutions and Life Sciences growth; a prolonged downturn in that segment could cap margin expansion.
- Near-term technical softness. MACD histogram is negative at -0.68 and RSI is neutral at 48.7, suggesting the stock may need to consolidate near the $93 level before extending gains.
- Integration risk from acquisitions. The Facet Filtration acquisition is a key growth driver but integration costs or execution missteps could pressure operating margin, which held at 15.1% in FY2025.
- Cyclicality in Engine Products. Revenue growth slowed to 2.92% in FY2025 from 4.53% in FY2024, and any further deceleration in heavy-duty engine demand could weigh on the aftermarket-driven replacement cycle.
What would change my mind
Where this comes from: Business Wire earnings release 2026-08-26 · peer_relative composite · insider summary · Defense World 2026-08-22 citing 13F filing. Orin's read on DCI; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All DCI filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Vanguard Portfolio Management | $585.6M | 0.0% of fund |
| Vanguard Capital Management | $471.3M | 0.0% of fund |
| State Street | $451.6M | 0.0% of fund |
| Fmr | $353.0M | 0.0% of fund |
| Geode Capital Management | $280.2M | 0.0% of fund |
| Morgan Stanley | $224.9M | 0.0% of fund |
70 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 231 Form 4 filings, net $5.1M. Of the 50 on hand, 0 were open-market purchases and 6 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about DCI
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Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 22.1× | — | 44.5× |
| EV/EBITDA | 17.9× | — | — |
| P/S | 2.59× | — | — |
| P/B | 5.7× | — | — |
10.0%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $0.4B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$97
$91 – $105 · +12% against today's price
- 5 buy or overweight
- 6 hold
- 3 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| DCIDonaldson Company, Inc. | $10B | 22.1× | 17.9× | 34.6% | 11.7% | 28% |
| AITApplied Industrial Technologies, Inc. | $12B | 30.1× | 23.0× | 30.3% | 8.3% | 22% |
| AOSA. O. Smith Corporation | $8B | 16.1× | 11.6× | 38.6% | 13.1% | 27% |
| CNMCore & Main, Inc. | $8B | 17.5× | 10.9× | 27.0% | 6.0% | 23% |
| CRCrane Company | $12B | 35.3× | 22.5× | 41.7% | 13.0% | 16% |
| FLSFlowserve Corporation | $10B | 26.8× | 15.7× | 35.1% | 8.0% | 17% |
| GNRCGenerac Holdings Inc. | $12B | 45.2× | 23.2× | 39.5% | 5.8% | 10% |
| POOLPool Corporation | $6B | 15.3× | 12.8× | 29.6% | 7.4% | 32% |
| RRXRegal Rexnord Corporation | $10B | 31.2× | 12.0× | 37.8% | 5.3% | 5% |
| SPXCSPX Technologies, Inc. | $9B | 30.8× | 17.1× | 40.2% | 11.3% | 12% |
| WTSWatts Water Technologies, Inc. | $12B | 31.2× | 19.3× | 48.8% | 14.3% | 19% |
The median is of the 10 peers listed above and nothing else — check it against the column. This company trades 27.3% below it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.