Shares of Donaldson Company rose 6% in pre-market trading after the filtration systems maker reported fourth-quarter adjusted earnings per share of $1.15, exceeding the $1.13 analyst estimate. Revenue totaled $1.1 billion, topping the $1.04 billion consensus, driven by an 8% year-over-year increase from $980.7 million in the prior-year period.
The growth reflected higher volumes, including roughly $30 million from the Facet acquisition, and pricing benefits. Adjusted gross margin expanded 190 basis points to 36.7%, while adjusted operating margin improved 110 basis points to 17.5%.
Segment performance showed broad-based gains. Mobile Solutions sales rose 7.9%, with aftermarket sales up 9.4% and on-road sales increasing 8.7%. Industrial Solutions sales grew 7.7%, with the Facet acquisition contributing 980 basis points of growth. Life Sciences sales advanced 9.7%.
Donaldson also provided fiscal 2027 guidance, projecting full-year adjusted EPS between $4.22 and $4.38, below the $4.41 consensus. The outlook includes approximately $0.12 of dilution from the Facet acquisition. Sales growth is forecast at 5.5% to 9.5%, while operating margins are expected to range from 16.6% to 17.2%, up from 16.0% on an adjusted basis in fiscal 2026.
By segment, mobile sales are projected to rise 2% to 6%, while industrial sales are expected to grow in the mid-teens. The company also anticipates repurchasing about 1% of its shares outstanding during the year.
Rich Lewis, president and chief executive officer, said, 'Donaldson's fourth-quarter sales and earnings reached an all-time high, driven by strong organic volume growth, augmented by the acquisition of Facet Filtration, and supported by robust execution across all three of our segments.'
