Middleby Buys Concordia, Expands Coffee Product Line
In order to extent coffee product line, Middleby Corporation ( MIDD ) recently announced the successful acquisition of Seattle-based
Concordia Coffee Company, Inc. for an undisclosed amount. The news
lifted the company’s share price by 0.5%, ending the trading
session at $87.63 on Sep 8.
Concordia Coffee Company specializes in manufacturing automated and
self-service coffee and espresso machines. It primarily serves a
diverse range of customers, mainly convenience stores, hotels and
restaurant chains, in the commercial foodservice industry. In the
coming months, Concordia Coffee Company is anticipated to launch a
new coffee machine – the Ascent – which offers on-demand brewed
coffee with zero wastage.
The transaction has expanded Middleby Corporation’s
revenue-generation capacities by $15 million along with its product
line in the beverage industry. The acquired firm will be integrated
with the Commercial Foodservice Equipment Group, the segment that
generated roughly 62% of total revenue in second-quarter 2014.
Going forward, Middleby Corporation is optimistic about recording
higher sales on the back of organic as well as inorganic growth.
The company is launching over 50 products, to be available by the
end of this year. In second-quarter 2014, Middleby Corporation
acquired a few companies, including Celfrost, Wunder-Bar, Market
Forge and Processing Equipment Solutions. These acquisitions
contributed roughly 6% to growth in sales.
The Zacks Consensus Estimate for Middleby Corporation is pegged at
$3.29 for 2014 and $4.03 for 2015, representing year-over-year
growth of 20.2% for 2014 and 22.6% for 2015.
With a market capitalization of $5 billion, Middleby currently
carries a Zacks Rank #2 (Buy). Some better-ranked stocks in the
industry include Metso Corporation ( MXCYY ), IDEX Corporation ( IEX ) and Nordson Corporation ( NDSN ). While Metso Corporation sports a Zacks Rank #1 (Strong Buy),
both IDEX Corporation and Nordson Corporation hold a Zacks Rank #2