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Middleby Enhances Food Processing Group With Gorreri Acquisition

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The Middleby Corporation (MIDD - Free Report) recently announced the completion of the acquisition of Gorreri Food Processing Technology. The financial terms of the transaction have been kept under wraps.

Middleby’s shares lost 3.3% yesterday to close the trading session at $142.18.

Based in Italy, Gorreri is a well-known provider of equipment for the baked goods industry. The company currently operates a 50,000-square-foot manufacturing facility, which was expanded to boost its growth. Gorreri generates revenues of about $20 million on an annual basis.

Inside the Headlines

The addition of Gorreri’s expertise in advanced baked goods solutions, coupled with its innovative manufacturing processes, is expected to strengthen Middleby’s position in the food processing end market. The buyout will enable Middleby to add several complementary products to its portfolio, including turbo mixers, injecting, dosing, decorating and ultrasonic portioning solutions.

This transaction is consistent with Middleby’s policy of acquiring businesses to expand market share, product offerings and customer base. In September 2024, it purchased Emery Thompson, which enhanced the company’s product offerings in the frozen dessert category. Also, in February 2024, it acquired Germany-based GBT GmbH Bakery Technology. The buyout complemented Middleby’s existing bakery brands and strengthened its European presence in large-scale baking.

MIDD’s Zacks Rank, Price Performance and Earnings Estimate Trend

Middleby, with a $7.6-billion market capitalization, currently carries a Zacks Rank #4 (Sell).

Lower demand for residential kitchen products due to weakness in the housing market, amid lower existing and new home sales, is affecting the performance of the Residential Kitchen Equipment Group segment. Also, softness in the restaurant industry, due to declining traffic, high wages and food cost inflation, is affecting the demand for the company's products within the Commercial Foodservice Equipment Group segment.

Zacks Investment Research
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Shares of Middleby have gained 2.1% compared with its industry’s 13.4% growth in the past three months.

The Zacks Consensus Estimate for 2024 earnings has decreased 5.4% to $9.12 per share in the past 60 days. Also, earnings estimates for 2025 have moved 4.3% south to $9.63 per share during the same period.

Stocks to Consider

Some better-ranked companies from the same space are discussed below.

Graham Corporation (GHM - Free Report) currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

GHM delivered a trailing four-quarter average earnings surprise of 101.9%. In the past 60 days, the Zacks Consensus Estimate for Graham’s fiscal 2025 earnings has increased 8.4%.

RBC Bearings Incorporated (RBC - Free Report) presently carries a Zacks Rank #2 (Buy). The company delivered a trailing four-quarter average earnings surprise of 2.5%.

In the past 60 days, the consensus estimate for RBC’s fiscal 2025 earnings has increased 1.4%.

Kadant Inc. (KAI - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 17.2%.

The Zacks Consensus Estimate for KAI’s 2024 earnings has increased 1.8% in the past 60 days.

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