For an investor who sees himself as more value-oriented than growth-oriented, Middleby (NASDAQ:MIDD)
is always challenging and frustrating. Built largely through
acquisitions, the company has nevertheless posted revenue growth in the
vicinity of 20% a year (annualized) over the past decade, with a
doubling of FCF margins supporting even better FCF growth. What's more,
it arguably doesn't get enough credit for growing and improving those
assets it acquires.
Middleby remains a stretch from a DCF
valuation perspective, or at least unless you're willing to assume
double-digit revenue growth and FCF productivity well above the norms of
the industry. That said, the price isn't so unreasonable from an
EV/EBITDA standpoint, and the company is working on commercializing
several concepts with significant revenue and margin potential.
Read the full article here:
Growth Still The Heart Of Middleby's Story
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