Rexnord Corporation has agreed to acquire Hadrian Inc, a leading provider of washroom partitions and lockers, for an undisclosed amount. Rexnord, the manufacturer of process and motion control as well as water management products, expects the deal to close by the end of this month.
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The Hadrian acquisition will enable Rexnord’s (RXN) “Water Management platform’s Zurn business to offer building owners a complete washroom solution and accelerate its strategy of being the leading provider of smart building solutions.”
Zurn’s group president Craig Wehr said, “With their passion for serving customers, market leading products and innovative technology, Hadrian brings a highly complementary culture and can build on Zurn’s substantial competitive advantages to expand our combined growth opportunities.”
Earlier, Rexnord reported stronger-than-expected 3Q results. Its earnings declined 7.8% year-over-year to $0.47 but exceeded the Street’s estimates of $0.37. Meanwhile, its 3Q revenues fell 5.3% to $494 million but handily surpassed analysts’ estimates of $442.5 million. (See RXN stock analysis on TipRanks).
On Nov. 30, Oppenheimer analyst Bryan Blair raised the stock’s price target to $44 (13.9% upside potential) from $38 and maintained a Buy rating. He said, “Given Rexnord’s strong fundamentals (including IMFC’s third-highest EBITDA margins) and solid balance sheet, we believe valuation metrics should continue to improve.”
Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 3 Buys and 3 Holds. The average price target stands at $39.17 and implies upside potential of about 1.4% to current levels. Shares were up by about 18.5% year-to-date.
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