Better Momentum in FY11 for Donaldson

Donaldson DCI announced earnings of $0.65 which was $0.01 above the consensus. Jefferies reports they are lowering their 2011 earnings estimate $0.05 to $2.55 “to better reflect a $0.16 headwind from growth investments and caution on seasonal weakness in December and January.” In other citings, Jefferies reports Donaldson’s sales rose 4% over the previous quarter. “DCI will reinvest an incremental $18m in FY11, split between growing its liquid filtration, expanding its international presence, growing R&D faster than forecasted sales growth of 4%-10%, and implementing a global supply chain effectiveness program.” Jefferies maintains a buy rating and has a price target of $52 on Donaldson. Jefferies closed yesterday at $41.90