LOW VALUATION ON MIDDLEBY AT $115.98 (MIDD-US)
Middleby Corporation makes commercial and residential kitchen equipment. The Company operates in three segments: the Commercial Foodservice Equipment Group, the Food Processing Equipment Group and the Residential Kitchen Equipment Group. The company has 28 plants in the US and 23 International facilities. Its brands include AGA, LaCornue, Anets, Beech, Blodgett, Stewart Systems, Mercury, Rangemaster, Rayburn and Redfyre and others.
JUSTIFICATION
Middleby isn’t well-known, but their brands top many wish lists. Their consumer brands AGA and LaCornue are award winning stoves that are often found in high end kitchens. We like the company’s focus on quality products, high margins and their excellent track record. We are less attracted to the high Price Earnings multiple (PE of 22X) but note that the peer group trades at an average 23.5X. The Purple Chips 12 -18 month target is $151.00.
