The Middleby Corp (NASDAQ:MIDD)

Still a small company executing well, can grow for a long long time. Also CEO is brilliant and passionate about company.

it will be ok

Leader in kitchen appliances for businesses and homes.

I'm giving Middleby the nod because I think they can pull off the Viking acquisition.

- Middleby benefits from brand recognition and trust of the quality of their products.
- Once they get established with commercial restaurants at the account level, they benefit as the chain continues to expand. For example, Papa John's uses only Middleby's ovens in all of the new locations it opens. This is easy $$ for Middleby, as long as they can keep up with demand and keep the customer relationship.
- They are in an industry that doesn't naturally attract disruptors. I'm not aware of any Harvard Business School MBA's that are itching to mix things up in commercial kitchens.

The biggest risks I can identify are:
- Huge amount of goodwill on their balance sheet as a result of their acquisitions. Goodwill was 42% of total assets last year...before the Viking purchase was even counted.
- They do not have established know-how in consumer sales. Will MIDD be able to successfully sell high-end commercial kitchens to homeowners?

Selim Bassoul is a CEO that's worth betting on. I think Middleby is a long-term outperformer.

SS#12

Small/Mid cap growth screen

Priced right, rising sales, PEG of 1.2, RoA=9.2%, RoE=18.7%, Profit & Operating Margins of 10% & 17.1%, Qrtrly Revenue & Earnings Growth of 23% & 13.9%, history of excellent engaged management. Debt (@$307M) could be lower, since it's one-third that of Sales ($820M), so I'm not crazy about that. But in the past, this has been a good pick for me, making real money. Hopefully that trends continues.

Great company!

The present price places the PE under 20. Fiscal 2011 should see restaurant sales up for the first time in three years.

One of the growth drivers for Middleby’s is the need for restaurants to retrofit their kitchens to increase efficiency. Even if the old oven is working well, new models offer a smaller footprint, higher energy savings and can cook faster. Speed means food gets out faster. Energy savings can be huge for restaurants. It takes a lot of electricity to run restaurant ovens. A small footprint gives companies room to add more equipment to expand their menus to better compete with other restaurants. These new products offered by Middleby that increase energy savings also carry higher margins.

Other companies are working on energy saving ovens and equipment, but the big players such as Manitowoc (MTW) Illinois Tool Works (ITS) and Middleby due to their size should have a big advantage over smaller players and should continue to pick up market share in the industry. They have the experience to build products that not only saves energy but keeps food quality high. Part of Middleby long-term practice was to work with customers to accumulate data on what makes a good oven and they have used the input from a huge customer base to design products that not only make the kitchen more efficient and cheaper to run, but keeps the attributes that keeps food quality high. This is where I think Middleby excels and what makes it tougher for smaller companies to succeed in the industry.

The restaurant industry is expected to make a bit of a comeback in 2011. Fewer restaurant closures and business sales are being reported. This could change if oil prices continue to go up, but fortunately they seem to be going down a bit thanks to higher margins requirements which is derailing speculators. If this trend continues, the restaurant industry may show signs of improvement. Regardless the restaurant survivors will be looking to find ways to give them an edge in costs, faster cooking times or ways to expand their menus to compete with strong competitors. I think this will keep Middleby busy.

Their valuation in my opinion is very good. The PE is 20.88. The cash flow yield is down some, but the first quarter tends to be the weakest for cash flow and they expect to report strong cash flow going forward in 2011. Timing of some orders also may boost cash flow in upcoming quarters. I think it was a good quarter and I look forward to better things as the rest of 2011 is reported.

Excellent products that are energy efficient

TMF1000 Favorite, Yum, Dominos, Subway just a few of their clients. Watch list candidate. Interested around $60 as of 10-16-10

Looking for ST pull back.

looks cheap and manages to earn good cash flows. Also it has been a long time HG favorite, so I will take my chances.

Way overbuilt dining sector. No room for growth.

Smart management, sound acquisitions

Sales have been good as restaurants have been doing well, especially fast foods.

I am bullish on Mcdonalds, so I have to be bullish on MIDD.

Solid Company with strong financials

midd-is a good solid company/fools i am currently just watching this stock-i know what i am going to buy in march. fool on