📊 DCI Key Takeaways
Is DONALDSON Co INC (DCI) a Good Investment?
Donaldson exhibits fortress-like financial health with exceptional liquidity (2.35x current ratio), low leverage (0.35x D/E), and robust free cash flow generation ($241.3M), providing a strong foundation for value creation. However, margin compression is concerning—net income declined 11.4% YoY despite 2.9% revenue growth—requiring close monitoring of operational efficiency and cost management to sustain returns.
Donaldson shows solid core fundamentals with healthy margins, good returns on capital, strong liquidity, and manageable leverage. However, the latest period shows only modest revenue growth while net income, EPS, and operating cash flow appear weaker, suggesting some pressure on earnings quality and near-term profitability momentum. Overall, the business looks financially sound, but current fundamental trends support a neutral stance rather than an aggressive positive rating.
DONALDSON Co INC Key Strengths (DCI)
- Exceptional balance sheet strength with 2.35x current ratio, 1.55x quick ratio, and 0.35x debt-to-equity ratio enabling financial flexibility
- Strong profitability with 34% gross margin, 15% operating margin, 11.5% net margin, and 19.1% ROE demonstrating efficient core operations
- Robust cash generation with $241.3M free cash flow and 26.3x interest coverage providing substantial debt servicing capacity and capital allocation optionality
- Strong profitability profile with 34.3% gross margin, 14.6% operating margin, and 11.3% net margin
- Healthy balance sheet with 2.29x current ratio, 1.46x quick ratio, and moderate 0.43x debt-to-equity
- Positive free cash flow generation and strong 16.6x interest coverage indicate solid financial resilience
DCI Stock Risks: DONALDSON Co INC Investment Risks
- Margin compression: Net income declined 11.4% YoY while revenue grew only 2.9%, indicating rising costs or pricing pressure reducing operational leverage
- Slowing organic growth at 2.9% YoY revenue growth suggests limited market expansion or mature market dynamics in industrial fan and air purification sector
- EPS dilution accelerating faster than net income decline (-9.8% vs -11.4%) signals potential share issuance or higher interest expense erosion of per-share economics
- Net income declined 11.4% YoY and diluted EPS fell 9.8% YoY despite revenue growth
- Revenue growth of 2.9% YoY is modest, which may limit operating leverage if demand softens
- Operating cash flow of $158.4M trails reported net income, which could signal weaker cash conversion if sustained
Key Metrics to Watch
- Operating margin trajectory and gross margin sustainability amid cost inflation
- Organic revenue growth acceleration and market share trends in core filtration and purification segments
- Free cash flow conversion rate and capital allocation discipline between organic investment and shareholder returns
- Operating cash flow and free cash flow conversion
- Net margin and EPS trend versus revenue growth
DONALDSON Co INC (DCI) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.35x current ratio provides a solid financial cushion.
DCI Profit Margin, ROE & Profitability Analysis
DCI vs Industrial Sector: How DONALDSON Co INC Compares
How DONALDSON Co INC compares to Industrial sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is DONALDSON Co INC Stock Overvalued? DCI Valuation Analysis 2026
Based on fundamental analysis, DONALDSON Co INC has mixed fundamental signals relative to the Industrial sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
DONALDSON Co INC Balance Sheet: DCI Debt, Cash & Liquidity
DCI Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: DONALDSON Co INC's revenue has grown significantly by 29% over the 5-year period, indicating strong business expansion. The most recent EPS of $2.90 reflects profitable operations.
DCI Revenue Growth, EPS Growth & YoY Performance
DCI Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2026 | $940.1M | $57.8M | $0.48 |
| Q2 2026 | $870.0M | $92.5M | $0.78 |
| Q1 2026 | $900.1M | $99.0M | $0.81 |
| Q3 2025 | $927.9M | $57.8M | $0.48 |
| Q2 2025 | $870.0M | $95.9M | $0.79 |
| Q1 2025 | $846.3M | $92.1M | $0.75 |
| Q3 2024 | $875.7M | $93.7M | $0.76 |
| Q2 2024 | $828.3M | $86.0M | $0.70 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
DONALDSON Co INC Dividends, Buybacks & Capital Allocation
DCI SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for DONALDSON Co INC (CIK: 0000029644)
📋 Recent SEC Filings
❓ Frequently Asked Questions about DCI
What is the AI rating for DCI?
DONALDSON Co INC (DCI) has a Combined AI Grade of A from Claude (A) and ChatGPT (B) with 74% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are DCI's key strengths?
Claude: Exceptional balance sheet strength with 2.35x current ratio, 1.55x quick ratio, and 0.35x debt-to-equity ratio enabling financial flexibility. Strong profitability with 34% gross margin, 15% operating margin, 11.5% net margin, and 19.1% ROE demonstrating efficient core operations. ChatGPT: Strong profitability profile with 34.3% gross margin, 14.6% operating margin, and 11.3% net margin. Healthy balance sheet with 2.29x current ratio, 1.46x quick ratio, and moderate 0.43x debt-to-equity.
What are the risks of investing in DCI?
Claude: Margin compression: Net income declined 11.4% YoY while revenue grew only 2.9%, indicating rising costs or pricing pressure reducing operational leverage. Slowing organic growth at 2.9% YoY revenue growth suggests limited market expansion or mature market dynamics in industrial fan and air purification sector. ChatGPT: Net income declined 11.4% YoY and diluted EPS fell 9.8% YoY despite revenue growth. Revenue growth of 2.9% YoY is modest, which may limit operating leverage if demand softens.
What is DCI's revenue and growth?
DONALDSON Co INC reported revenue of $2.8B.
Does DCI pay dividends?
DONALDSON Co INC pays dividends, with $104.0M distributed to shareholders in the trailing twelve months.
Where can I find DCI SEC filings?
Official SEC filings for DONALDSON Co INC (CIK: 0000029644) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is DCI's EPS?
DONALDSON Co INC has a diluted EPS of $2.75.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is DCI's fundamental grade?
Based on our AI fundamental analysis in June 2026, DONALDSON Co INC has a A grade with 74% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is DCI stock overvalued or undervalued?
Valuation metrics for DCI: ROE of 19.1% (sector avg: 15%), net margin of 11.5% (sector avg: 10%). Higher ROE suggests strong returns relative to peers.
What is DCI's AI grade for 2026?
Our dual AI analysis gives DONALDSON Co INC a combined A grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is DCI's free cash flow?
DONALDSON Co INC's operating cash flow is $293.8M, with capital expenditures of $52.5M. FCF margin is 8.5%.
How does DCI compare to other Industrial stocks?
Vs Industrial sector averages: Net margin 11.5% (avg: 10%), ROE 19.1% (avg: 15%), current ratio 2.35 (avg: 1.8).