Dover's (DOV) Arm Inks Deal to Expand Software Solution Offerings

Dover Corporation (NYSE:DOV) DOV has entered into an agreement with EdgePetrol Limited to acquire minority interest in a bid to expand its software solutions services to the global retail industry.

Based in London, EdgePetrol provides an innovative cloud-based software solution for management of revenues and operating results to the retail fueling industry. This secure and comprehensive solution operates in the Amazon (NASDAQ:AMZN) Web Service (AWS) and complements Dover Fueling Solutions ("DFS"). DFS provides devices which assist in managing the flow of underlying data, while helping customers improve their business operations. Besides retail fueling, this software solution will provide DFS with growth scope in renewable energy for transportation and various other retail verticals. Notably, the latest agreement supports DFS’ goal of expanding its business through strategic partnerships, and broadening the solutions and products portfolio.

Dover has a long tradition of making successful acquisitions in diverse end markets. In fourth-quarter 2020, the company acquired Innovation Control Systems (ICS) in a bid to expand its offerings in the growing vehicle wash market. Last September, the company acquired XanTec in an effort to expand its automation solutions offering for polymer processing machines. In 2019, the company acquired three businesses for a total consideration of $216.4 million. Dover made these acquisitions to complement and expand upon the existing operations within the Fueling Solutions and Pumps & Process Solutions segments.

Given the improving market conditions and a robust demand backlog in the current year, Dover projects adjusted earnings per share between $6.25 and $6.45 for 2021. Revenue growth is estimated to be 8-10% (5-6% on an organic basis) for the full year. Moreover, the company is poised to gain from growth in biopharma, aerospace & defense, heat exchangers, food retail and marking & coding business for the current year.

Dover will gain from product digitization, e-commerce, new product development, and inorganic investment in core business platforms. The company’s productivity and cost-control initiatives continue to drive its top-line growth. Apart from this, Dover’s restructuring programs will support its margins.

Price Performance

The company’s shares have appreciated 64.7% over the past year compared with the industry’s rally of 201.9%.

Zacks Rank & Other Stocks to Consider

Dover currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other similarly-ranked stocks in the Industrial Products sector are Deere (NYSE:DE) & Co. DE, AGCO Corporation AGCO and Avery Dennison Corporation (NYSE:AVY) AVY.

Deere has a projected earnings growth rate of 82.5% for fiscal 2021. Over the past year, the company’s shares have appreciated 133.2%.

AGCO has an estimated earnings growth rate of 29.9% for the ongoing year. The company’s shares have surged 134.1% in the past year.

Avery Dennison has an expected earnings growth rate of 11.8% for 2021. The stock has gained 79.2% in a year’s time.

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