June 11, 2017
NYSE: DOV
DOVER CORP
BUY
A+
A
A-
HOLD
B+
B
Annual Dividend Rate
$1.76
B-
C+
C
Annual Dividend Yield
2.13%
SELL
C-
D
Beta
1.20
Sector: Industrials
DOV BUSINESS DESCRIPTION
Dover Corporation manufactures and sells a range
of equipment and components, specialty systems,
software and digital solutions, and support services
worldwide. The company operates in four
segments: Energy, Engineered Systems, Fluids, and
Refrigeration & Food Equipment.
D+
D-
E+
E
E-
F
Market Capitalization
$12.8 Billion
Sub-Industry: Industrial Machinery
Weekly Price: (US$)
SMA (50)
BUY
52-Week Range
$63.93-$84.40
RATING SINCE
TARGET PRICE
05/25/2016
$107.60
Price as of 6/8/2017
$82.38
Source: S&P
SMA (100)
1 Year
2 Years
110
TARGET
TARGET
TARGETPRICE
PRICE
PRICE$107.60
$107.60
$107.60
TARGET
100
90
80
STOCK PERFORMANCE (%)
3 Mo.
Price Change
6.64
1 Yr.
14.99
3 Yr (Ann)
-2.29
70
60
GROWTH (%)
Last Qtr
11.77
73.36
70.31
Revenues
Net Income
EPS
12 Mo.
1.78
-23.42
1.08
RETURN ON EQUITY (%)
DOV
Q1 2017
14.71
Q1 2016
15.63
Q1 2015
20.26
Ind Avg
20.75
19.23
23.48
3 Yr CAGR
-0.98
-15.18
-7.19
S&P 500
12.81
11.95
14.20
22.20
27.87
25.74
DOV
Ind Avg
S&P 500
BUY
Volume in Millions
20
10
2016
0
2017
COMPUSTAT for Price and Volume, TheStreet Ratings, Inc. for Rating History
HIGHLIGHTS
DOV's revenue growth has slightly outpaced the industry average of 5.0%. Since the same quarter one year
prior, revenues rose by 11.8%. Growth in the company's revenue appears to have helped boost the earnings
per share.
2016
The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500
and the Machinery industry. The net income increased by 73.4% when compared to the same quarter one
year prior, rising from $99.36 million to $172.25 million.
Q1 1.09
Q4 1.03
Q3 0.83
Q2 0.76
Q1 0.64
Q4 0.87
Q3 1.19
Q2 0.97
HOLD
Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the
market's overall trend during that period and the fact that the company's earnings growth has been robust.
Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can
fall in an overall down market. However, in any other environment, this stock still has good upside potential
despite the fact that it has already risen in the past year.
EPS ANALYSIS¹ ($)
Q1 0.72
BUY
RECOMMENDATION
We rate DOVER CORP (DOV) a BUY. This is driven by a few notable strengths, which we believe should have a
greater impact than any weaknesses, and should give investors a better performance opportunity than most
stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid
stock price performance, reasonable valuation levels, increase in net income and growth in earnings per
share. We feel its strengths outweigh the fact that the company shows weak operating cash flow.
P/E COMPARISON
2015
50
Rating History
2017
NA = not available NM = not meaningful
1 Compustat fiscal year convention is used for all fundamental
data items.
DOVER CORP reported significant earnings per share improvement in the most recent quarter compared to
the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it
is poised for EPS growth in the coming year. During the past fiscal year, DOVER CORP reported lower
earnings of $3.26 versus $3.75 in the prior year. This year, the market expects an improvement in earnings
($4.18 versus $3.26).
This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
Report Date: June 11, 2017
PAGE 1
June 11, 2017
NYSE: DOV
DOVER CORP
Sector: Industrials Industrial Machinery Source: S&P
Annual Dividend Rate
$1.76
Annual Dividend Yield
2.13%
PEER GROUP ANALYSIS
18%
FA
BL
E
NDSN
IEX
SNA
UN
SWK
FA
ITW
LE
-2%
B
RA
VO
Revenue Growth (TTM)
XYL
PH
27.5%
EBITDA Margin (TTM)
Companies with higher EBITDA margins and
revenue growth rates are outperforming companies
with lower EBITDA margins and revenue growth
rates. Companies for this scatter plot have a market
capitalization between $6.7 Billion and $49.9 Billion.
Companies with NA or NM values do not appear.
*EBITDA – Earnings Before Interest, Taxes, Depreciation and
Amortization.
Manufactures have been moving to lower cost areas for production in order to contain costs. This allows the
company to achieve better margins and improve competitiveness. Additionally, another positive along with
this is that it allows the company to be closer to the emerging demand base and thus its new customers.
The three main segments of the machinery industry are flow control equipment, electrical equipment and
industrial automation. The need for products from these groups is driven on a macro-level to a certain
degree, which depends on the strength of the world economy as well as government funding. Geographically,
the outlook for the industry remains positive in North America, Latin America, and Asia, with a neutral
forecast for Europe. As with any industry that exports products, the machinery industry is helped by a weaker
U.S. dollar and less competitive as the dollar strengthens.
The machinery industry is not heavily regulated, though there has been an increased interest by the
government to raise energy efficiency of electrical equipment. Along with improved efficiency, the products
that will likely continue to support growth in the industry are wireless components and sensors - especially
for use in detecting biological or chemical factors. Pump and valve technology will always be in demand in
order to fulfill the ongoing need for the treatment of drinkable water and wastewater treatment. Finally,
robotics orders have rebounded after suffering from the downturn in the automotive market.
The key players in the industry include Caterpillar (CAT), Deere (DE), Illinois Tool Works (ITW), Cummins
(CMI), Flowserve (FLS), and Ingersoll-Rand (IR).
REVENUE GROWTH AND EARNINGS YIELD
18%
Price as of 6/8/2017
$82.38
The challenges the industry faces include the surges in commodity costs, which lowers margins. The result of
these commodity increases have been higher prices, which customers have generally seemed to absorb as
surcharges have helped cover the difference, though there is no guarantee this will continue. Steel and
copper in particular saw the highest increase in prices.
RA
VO
PNR
MIDD
PEER GROUP: Machinery
FA
RA
VO
BL
PNR
E
NDSN
XYL
IEX
SNA
UN
ITW
FA
LE
-2%
B
RA
VO
Revenue Growth (TTM)
52-Week Range
$63.93-$84.40
The Machinery industry continues to experience consolidation, globalization, and cost containment with the
biggest companies expected to continue to dominate and generate the most revenue.
MIDD
10%
Market Capitalization
$12.8 Billion
INDUSTRY ANALYSIS
REVENUE GROWTH AND EBITDA MARGIN*
IR DOV
Beta
1.20
2.5%
DOV
PH
SWK
IR
6.5%
Earnings Yield (TTM)
Companies that exhibit both a high earnings yield
and high revenue growth are generally more
attractive than companies with low revenue growth
and low earnings yield. Companies for this scatter
plot have revenue growth rates between -0.5% and
17.8%. Companies with NA or NM values do not
appear.
Ticker
DOV
XYL
SNA
IEX
MIDD
NDSN
ITW
IR
SWK
PH
PNR
Recent
Company Name
Price ($)
DOVER CORP
82.38
XYLEM INC
53.58
SNAP-ON INC
156.88
IDEX CORP
110.30
MIDDLEBY CORP
131.51
NORDSON CORP
115.73
ILLINOIS TOOL WORKS
144.59
INGERSOLL-RAND PLC
87.97
STANLEY BLACK & DECKER INC 137.91
PARKER-HANNIFIN CORP
154.53
PENTAIR PLC
64.74
Market
Cap ($M)
12,824
9,629
9,091
8,417
7,566
6,670
49,949
22,522
21,106
20,581
11,799
Price/
Earnings
22.20
38.55
16.62
30.30
25.00
24.42
24.30
15.99
17.64
22.56
26.86
Net Sales
TTM ($M)
6,985.44
3,995.00
3,775.20
2,164.02
2,281.79
1,902.79
13,796.00
13,615.40
11,540.40
11,490.22
4,883.50
Net Income
TTM ($M)
581.78
250.00
559.70
278.88
300.38
274.59
2,103.00
1,440.90
1,169.00
931.90
502.60
The peer group comparison is based on Major Industrial Machinery companies of comparable size.
This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
Report Date: June 11, 2017
PAGE 2
June 11, 2017
NYSE: DOV
DOVER CORP
Sector: Industrials Industrial Machinery Source: S&P
Annual Dividend Rate
$1.76
Annual Dividend Yield
2.13%
COMPANY DESCRIPTION
Dover Corporation manufactures and sells a range of
equipment and components, specialty systems, software
and digital solutions, and support services worldwide.
The company operates in four segments: Energy,
Engineered Systems, Fluids, and Refrigeration & Food
Equipment. The Energy segment provides solutions and
services for the production and processing of fuels to
drilling and production, bearings and compression, and
automation end markets. The Engineered Systems
segment offers precision marking and coding, digital
textile printing, soldering and dispensing equipment, and
related consumables and services; and automation
components, including manual clamps, power clamps,
rotary and linear mechanical indexers, conveyors, pick
and place units, glove ports, and manipulators, as well
as end-of-arm robotic grippers, slides, and end effectors
for fast-moving consumer goods, digital textile printing,
vehicle service, environmental solutions, and industrials
end markets. The Fluids segment focuses on the safe
handling of critical fluids across the retail fueling,
chemical, hygienic, oil and gas, and industrial markets.
This segment also manufactures connectors for use in
various bio-processing applications; and pumps and
compressors that are used to transfer liquid and bulk
products in various markets, including refined fuels, LPG,
food/sanitary, transportation, and chemical process
industries. The Refrigeration & Food Equipment segment
manufactures refrigeration systems, refrigeration display
cases, specialty glass, commercial glass refrigerator and
freezer doors, and brazed heat exchangers; and electrical
distribution products and engineering services,
commercial food service equipment, cook-chill
production systems, custom food storage and
preparation products, kitchen ventilation systems,
conveyer systems, and beverage can-making machinery.
The company was founded in 1947 and is headquartered
in Downers Grove, Illinois.
DOVER CORP
3005 Highland Parkway
Downers Grove, IL 60515
USA
Phone: 630-541-1540
Fax: 630-743-2671
http://www.dovercorporation.com
Beta
1.20
Market Capitalization
$12.8 Billion
52-Week Range
$63.93-$84.40
Price as of 6/8/2017
$82.38
STOCK-AT-A-GLANCE
Below is a summary of the major fundamental and technical factors we consider when determining our
overall recommendation of DOV shares. It is provided in order to give you a deeper understanding of our
rating methodology as well as to paint a more complete picture of a stock's strengths and weaknesses. It is
important to note, however, that these factors only tell part of the story. To gain an even more comprehensive
understanding of our stance on the stock, these factors must be assessed in combination with the stock’s
valuation. Please refer to our Valuation section on page 5 for further information.
FACTOR
SCORE
2.5
Growth
out of 5 stars
weak
Measures the growth of both the company's income statement and
cash flow. On this factor, DOV has a growth score better than 40% of
the stocks we rate.
strong
4.0
Total Return
out of 5 stars
weak
Measures the historical price movement of the stock. The stock
performance of this company has beaten 70% of the companies we
cover.
strong
4.5
Efficiency
out of 5 stars
weak
Measures the strength and historic growth of a company's return on
invested capital. The company has generated more income per dollar of
capital than 80% of the companies we review.
strong
4.0
Price volatility
out of 5 stars
weak
Measures the volatility of the company's stock price historically. The
stock is less volatile than 70% of the stocks we monitor.
strong
5.0
Solvency
out of 5 stars
weak
Measures the solvency of the company based on several ratios. The
company is more solvent than 90% of the companies we analyze.
strong
4.0
Income
out of 5 stars
weak
Measures dividend yield and payouts to shareholders. The company's
dividend is higher than 70% of the companies we track.
strong
THESTREET RATINGS RESEARCH METHODOLOGY
TheStreet Ratings' stock model projects a stock's total return potential over a 12-month period including both
price appreciation and dividends. Our Buy, Hold or Sell ratings designate how we expect these stocks to
perform against a general benchmark of the equities market and interest rates. While our model is
quantitative, it utilizes both subjective and objective elements. For instance, subjective elements include
expected equities market returns, future interest rates, implied industry outlook and forecasted company
earnings. Objective elements include volatility of past operating revenues, financial strength, and company
cash flows.
Our model gauges the relationship between risk and reward in several ways, including: the pricing drawdown
as compared to potential profit volatility, i.e.how much one is willing to risk in order to earn profits; the level of
acceptable volatility for highly performing stocks; the current valuation as compared to projected earnings
growth; and the financial strength of the underlying company as compared to its stock's valuation as
compared to projected earnings growth; and the financial strength of the underlying company as compared
to its stock's performance. These and many more derived observations are then combined, ranked, weighted,
and scenario-tested to create a more complete analysis. The result is a systematic and disciplined method of
selecting stocks.
This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
Report Date: June 11, 2017
PAGE 3
June 11, 2017
NYSE: DOV
DOVER CORP
Sector: Industrials Industrial Machinery Source: S&P
Annual Dividend Rate
$1.76
Annual Dividend Yield
2.13%
Consensus EPS Estimates² ($)
IBES consensus estimates are provided by Thomson Financial
0.99
4.18 E
4.40 E
Q2 FY17
2017(E)
2018(E)
Market Capitalization
$12.8 Billion
52-Week Range
$63.93-$84.40
Price as of 6/8/2017
$82.38
FINANCIAL ANALYSIS
DOVER CORP's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when
compared to the same period a year ago. The company managed to grow both sales and net income at a
faster pace than the average competitor in its industry this quarter as compared to the same quarter a year
ago. DOVER CORP has weak liquidity. Currently, the Quick Ratio is 0.74 which shows a lack of ability to cover
short-term cash needs. The liquidity decreased from the same period a year ago, despite already having
weak liquidity to begin with. This would indicate deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has increased by 6.90% from the same quarter last
year. Overall, the key liquidity measurements indicate that the company is in a position in which financial
difficulties could develop in the future.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the
next 12-months. To learn more visit www.TheStreetRatings.com.
INCOME STATEMENT
Net Sales ($mil)
EBITDA ($mil)
EBIT ($mil)
Net Income ($mil)
Beta
1.20
Q1 FY17
1,813.37
277.50
181.90
172.25
Q1 FY16
1,622.27
248.81
160.20
99.36
Q1 FY17
415.53
10,238.31
3,636.39
3,953.42
Q1 FY16
243.72
8,980.90
3,016.50
3,698.13
Q1 FY17
41.96%
15.30%
10.03%
0.68
5.68%
14.71%
Q1 FY16
42.15%
15.33%
9.88%
0.76
8.45%
15.63%
Q1 FY17
1.19
0.48
36.41
5.00
Q1 FY16
1.42
0.45
33.32
4.81
Q1 FY17
156
0.44
1.09
25.40
NA
1,389,569
Q1 FY16
155
0.42
0.64
23.84
NA
1,123,320
BALANCE SHEET
Cash & Equiv. ($mil)
Total Assets ($mil)
Total Debt ($mil)
Equity ($mil)
PROFITABILITY
Gross Profit Margin
EBITDA Margin
Operating Margin
Sales Turnover
Return on Assets
Return on Equity
DEBT
Current Ratio
Debt/Capital
Interest Expense
Interest Coverage
SHARE DATA
Shares outstanding (mil)
Div / share
EPS
Book value / share
Institutional Own %
Avg Daily Volume
2 Sum of quarterly figures may not match annual estimates due to
use of median consensus estimates.
This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
Report Date: June 11, 2017
PAGE 4
June 11, 2017
NYSE: DOV
DOVER CORP
Sector: Industrials Industrial Machinery Source: S&P
Annual Dividend Rate
$1.76
Annual Dividend Yield
2.13%
RATINGS HISTORY
Our rating for DOVER CORP has not changed since
5/25/2016. As of 6/8/2017, the stock was trading at a
price of $82.38 which is 2.4% below its 52-week
high of $84.40 and 28.9% above its 52-week low of
$63.93.
Price/Earnings
$70
52-Week Range
$63.93-$84.40
1
2
3
premium
4
5
DOV 22.20
Peers 27.87
• Discount. A lower P/E ratio than its peers can
signify a less expensive stock or lower growth
expectations.
• DOV is trading at a discount to its peers.
Price/Projected Earnings
1
2
3
premium
From
Hold
Buy
Buy
To
Buy
Hold
Buy
4
5
DOV 18.72
Peers 21.97
• Discount. A lower price-to-projected earnings ratio
than its peers can signify a less expensive stock or
lower future growth expectations.
• DOV is trading at a discount to its peers.
Price/Book
(as of 6/8/2017)
43.85% Buy - We believe that this stock has the
opportunity to appreciate and produce a total return of
more than 10% over the next 12 months.
30.12% Hold - We do not believe this stock offers
conclusive evidence to warrant the purchase or sale of
shares at this time and that its likelihood of positive total
return is roughly in balance with the risk of loss.
26.02% Sell - We believe that this stock is likely to
decline by more than 10% over the next 12 months, with
the risk involved too great to compensate for any
possible returns.
1
2
3
premium
4
5
Price/Sales
1
2
premium
3
4
5
Price to Earnings/Growth
4
5
discount
1
2
3
premium
4
5
discount
DOV 0.78
Peers 1.27
• Discount. The PEG ratio is the stock’s P/E divided
by the consensus estimate of long-term earnings
growth. Faster growth can justify higher price
multiples.
• DOV trades at a significant discount to its peers.
Earnings Growth
1
2
3
4
lower
5
higher
DOV 1.08
Peers 24.12
• Lower. Elevated earnings growth rates can lead to
capital appreciation and justify higher
price-to-earnings ratios.
• However, DOV is expected to significantly trail its
peers on the basis of its earnings growth rate.
Sales Growth
discount
DOV 1.84
Peers 2.05
• Discount. In the absence of P/E and P/B multiples,
the price-to-sales ratio can display the value
investors are placing on each dollar of sales.
• DOV is trading at a discount to its industry on this
measurement.
3
DOV 15.88
Peers 16.18
• Average. The P/CF ratio, a stock’s price divided by
the company's cash flow from operations, is useful
for comparing companies with different capital
requirements or financing structures.
• DOV is trading at a valuation on par to its peers.
discount
DOV 3.24
Peers 4.98
• Discount. A lower price-to-book ratio makes a
stock more attractive to investors seeking stocks
with lower market values per dollar of equity on the
balance sheet.
• DOV is trading at a significant discount to its peers.
2
premium
discount
Price reflects the closing price as of the date listed, if available
RATINGS DEFINITIONS &
DISTRIBUTION OF THESTREET RATINGS
1
Price/CashFlow
discount
2016
MOST RECENT RATINGS CHANGES
Date
Price
Action
5/25/16
$66.67
Upgrade
1/27/16
$55.31 Downgrade
6/8/15
$72.76 No Change
Price as of 6/8/2017
$82.38
VALUATION
BUY. This stock's P/E ratio indicates a discount compared to an average of 27.87 for the Machinery industry
and a discount compared to the S&P 500 average of 25.74. To use another comparison, its price-to-book ratio
of 3.24 indicates valuation on par with the S&P 500 average of 3.09 and a significant discount versus the
industry average of 4.98. The price-to-sales ratio is below both the S&P 500 average and the industry average,
indicating a discount. Upon assessment of these and other key valuation criteria, DOVER CORP proves to
trade at a discount to investment alternatives within the industry.
$80
$60
2015
Market Capitalization
$12.8 Billion
$90
BUY: $66.67
HOLD: $55.31
BUY: $72.76
2 Year Chart
Beta
1.20
1
2
3
lower
4
5
higher
DOV 1.78
Peers 12.69
• Lower. A sales growth rate that trails the industry
implies that a company is losing market share.
• DOV significantly trails its peers on the basis of
sales growth
DISCLAIMER:
TheStreet Ratings
14 Wall Street, 15th Floor
New York, NY 10005
www.thestreet.com
The opinions and information contained herein have been obtained or derived from sources believed to be reliable, but
TheStreet Ratings cannot guarantee its accuracy and completeness, and that of the opinions based thereon. Data is provided
via the COMPUSTAT® Xpressfeed product from Standard &Poor's, a division of The McGraw-Hill Companies, Inc., as well as
other third-party data providers.
Research Contact: 212-321-5381
Sales Contact: 866-321-8726
TheStreet Ratings is a division of TheStreet, Inc., which is a publisher. This research report contains opinions and is provided
for informational purposes only. You should not rely solely upon the research herein for purposes of transacting securities or
other investments, and you are encouraged to conduct your own research and due diligence, and to seek the advice of a
qualified securities professional, before you make any investment. None of the information contained in this report constitutes,
or is intended to constitute a recommendation by TheStreet Ratings of any particular security or trading strategy or a
determination by TheStreet Ratings that any security or trading strategy is suitable for any specific person. To the extent any of
the information contained herein may be deemed to be investment advice, such information is impersonal and not tailored to the
investment needs of any specific person. Your use of this report is governed by TheStreet, Inc.'s Terms of Use found at
http://www.thestreet.com/static/about/terms-of-use.html.
This report is for information purposes only and should not be considered a solicitation to buy or sell any security. Neither TheStreet Ratings nor any other party guarantees its accuracy
or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of TheStreet Ratings. Copyright(c) 2006-2016. All rights reserved.
Report Date: June 11, 2017
PAGE 5