8 Most Undervalued Industrial Stocks to Buy According to Analysts

6) The Middleby Corporation (NASDAQ:MIDD)

Forward P/E as of October 8: 12.38x

Number of Hedge Fund Holders: 25

Average Upside Potential: 24.24%

The Middleby Corporation (NASDAQ:MIDD) is engaged in designing, marketing, manufacturing, distributing, and servicing food service, food processing, and residential kitchen equipment.

The Middleby Corporation (NASDAQ:MIDD)’s strong brand equity, exceptional product performance,  and competitive pricing should continue to help it sustain its growth trajectory. The company’s food processing business remains focused on automation, sustainability, and opportunities in pre-cooked bacon and poultry lines. The Middleby Corporation (NASDAQ:MIDD) has its focus on operational efficiency, cost reduction, and margin expansion. It continues to enjoy a strong pipeline of active projects in Food Processing, with potential for double-digit YoY growth in Q3 and Q4.

Notably, large projects in Commercial Foodservice provide increased margins, and the company also highlighted that the backlog with dealer channel partners remains stronger than before. In the recent earnings call, The Middleby Corporation (NASDAQ:MIDD) highlighted that a strong pipeline of M&A deals is expected to be more active moving forward.

The Middleby Corporation (NASDAQ:MIDD)’s strategic initiatives and focus on new product innovations, primarily in the technology and connectivity space, placed the company well amidst a challenging market. Industry veterans opine that the expected acceleration in unit development by restaurant chains should help the company’s growth framework.

Robert W. Baird increased its target price on the shares of The Middleby Corporation (NASDAQ:MIDD) from $155.00 to $169.00, giving an “Outperform” rating on 2^nd August. As per Insider Monkey’s Q2 2024 database, 25 hedge funds reported owning stakes in the company.

Ariel Investments, an investment management company, released its second-quarter 2024 investor letter. Here is what the fund said:

“Additionally, leading food equipment manufacturer, The Middleby Corporation (NASDAQ:MIDD), declined in the period following an earnings miss driven by weaker-than-anticipated organic sales across the commercial, residential and food processing businesses. Importantly, management noted conditions are improving with channel inventories returning to normalized levels and order volumes trending in a positive direction. Meanwhile, profitability remains solid and MIDD continues to generate strong free cash flow. In our view, MIDD’s differentiated brands and kitchen innovations offer the latest in automation and advanced cooking technologies, positioning the company for growth and margin expansion as it serves the rapidly evolving needs of the food service industry.”