DOV Dover Corporation
A high-quality industrial compounder whose valuation still outruns its demonstrated growth.
The story
Dover is a diversified industrial compounder built around defensible engineered-product niches, recurring aftermarket demand, decentralized execution, and disciplined acquisitions. Its moat supports above-average margins, but muted historical organic growth and cyclical exposure place it closer to mature quality industrial than long-run high-growth franchise.
The prior drivers remain appropriate: current revenue and margin evidence does not justify a material revision, while 5% near-term growth already assumes improvement from the roughly 1% five-year CAGR. Margins rise modestly toward sustainable niche-industrial economics, and reinvestment efficiency remains near Dover's observed range rather than assuming acquisition-driven growth is costless.
Value drivers
| Revenue growth (Y1) | 5.0% |
| Terminal growth | 3.0% |
| Forecast horizon | 8y |
| Target operating margin | 19.5% |
| Years to target margin | 7 |
| Sales-to-capital | 0.82 |
| Beta | 1.07 |
| Failure probability | 1.0% |
| Cost of capital (WACC) | 8.9% |
| Terminal WACC | 8.6% |
Valuation bridge
| PV of explicit FCFF | 5.67B |
| PV of terminal value | 11.96B |
| Equity value | 15.82B |
| ÷ shares → per share | $117.51 |
News
bullish +0.30 · 8 articles
- 1 Mid-Cap Stock with Promising Prospects and 2 We Avoid
- Illinois Tool Stock's Loudest Signal Is The One It Stopped Sending
- Dover (DOV) Launches Diamond Fueling Platform As The Undervalued Narrative Holds
- Dover (DOV) Launches OPW Diamond Platform For Fuel Distribution Control
- 1 Hidden Tech Catalyst Makes Dover Corporation an Absolute Sanctuary for Retirees Protecting Their Wealth
- Dover Corporation (DOV) Stock Up Slightly Since Jim Cramer Said It Could Be Different
- 3 Reasons to Sell DOV and 1 Stock to Buy Instead
- Dover's Q2 2026 Earnings: What to Expect
Projected free cash flow to the firm
| Yr | Revenue | Growth | Margin | NOPAT | Reinvest | FCFF | PV |
|---|---|---|---|---|---|---|---|
| 1 | 8.69B | 5.0% | 18.2% | 1.26B | 504.89M | 759.01M | 697.06M |
| 2 | 9.10B | 4.7% | 18.4% | 1.34B | 499.84M | 839.34M | 707.92M |
| 3 | 9.51B | 4.4% | 18.6% | 1.41B | 491.68M | 923.20M | 715.10M |
| 4 | 9.90B | 4.1% | 18.9% | 1.49B | 480.33M | 1.01B | 718.65M |
| 5 | 10.28B | 3.9% | 19.1% | 1.57B | 465.73M | 1.10B | 718.68M |
| 6 | 10.65B | 3.6% | 19.3% | 1.64B | 447.86M | 1.19B | 715.31M |
| 7 | 11.00B | 3.3% | 19.5% | 1.71B | 426.75M | 1.29B | 708.70M |
| 8 | 11.33B | 3.0% | 19.5% | 1.76B | 402.44M | 1.36B | 689.17M |
Key risks
- Industrial cyclicality and weaker customer capital spending
- Acquisition overpayment or integration underperformance
- Valuation requiring growth materially above Dover's recent record
Catalysts
- Sustained organic growth from new platforms and aftermarket expansion
- Margin improvement through portfolio mix and operating discipline