PentairPentair (PNR) is an industrial manufacturing name that builds water pumps, filters, and valves as well as enclosures that house sensitive electronics. Let's face it, that's a pretty boring business -- but boring is generally a good thing for dividend investors. With a host of factors pointing toward a hike to Pentair's 22-cent quarterly dividend payout, we're taking a closer look at this Schaffhausen, Switzerland-based firm today.
As the go-to name in commercial and residential water filtration, Pentair has a big economic moat over rivals trying to break into the market. Filtration is a quality over cost business; in other words, customers are more elastic to pricing changes as long as they know that their water is being filtered well -- that, and the huge sunk costs of switching filter types, has give PNR sticky revenues. And since filters are consumables, those sales tend to be recurring too.
PNR's industrial pump and valve business has been growing on the heels of filters. In recent years, PNR has embraced non-industrial revenues like those from the food and beverage industry, capitalizing on a market that's used to spending a premium for cleaner water. Pentair doesn't carry much balance sheet liquidity, but that's due in part to how much cash PNR consistently generates from operations. With that cash number ticking higher, the firm looks likely to announce a dividend hike in the next quarter.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV