NEW YORK - Griffon Corporation (NYSE: NYSE:GFF), through its subsidiary The AMES Companies, Inc., has expanded its presence in the Australian market with the acquisition of Pope, a prominent residential watering products company, from The Toro Company (NYSE:NYSE:TTC).
The transaction, which marks AMES's seventh Australian acquisition since 2013, is expected to bring in an additional $25 million in annualized revenue and positively impact Griffon's earnings within the first full year of ownership. The financial specifics of the deal remain undisclosed.
Pope, known for its range of residential watering products, aligns with AMES's strategy to broaden its product offerings in Australia. This acquisition is part of Griffon's ongoing efforts to diversify and strengthen its global reach in the home and building products sector.
Griffon's Consumer and Professional Products (CPP) segment, which includes AMES, is a significant provider of branded consumer and professional tools, lifestyle enhancement products, and home organization solutions.
Griffon Corporation operates two main segments: Home and Building Products, which includes Clopay Corporation, the leading North American manufacturer of residential and commercial doors, and the CPP segment. The CPP segment is known for its portfolio of established brands, such as AMES and Hunter.
The integration of Pope into Griffon's portfolio is seen as a strategic move to reinforce its position in the global market, particularly in the Australian region where AMES has been actively growing its footprint. The addition of Pope is anticipated to contribute to Griffon's performance metrics and overall value proposition to shareholders.
This acquisition is based on a press release statement and further details on the transaction's impact on the companies' operations and financials were not provided. Griffon Corporation, a diversified management and holding company, continues to explore opportunities for growth and acquisition that promise potentially attractive returns on capital.
In other recent news, The Toro Company has sold its Pope Products business to The AMES Company, a subsidiary of Griffon Corporation. This strategic decision aims to streamline Toro's portfolio and focus on areas with potential for profitable growth, such as golf, sports fields and grounds, professional contractor, rental, and residential sectors.
The divestiture is not expected to significantly impact Toro's fiscal 2024 results. Toro, which operates globally in over 125 countries, reported net sales of $4.55 billion in fiscal 2023.
On the other hand, Griffon Corporation reported strong Q2 results for fiscal year 2024, surpassing expectations. Despite a decrease in revenue in the Consumer and Professional Products segment, the company saw improvement in EBITDA figures and raised its full-year revenue guidance to $2.65 billion.
Griffon also increased its segment adjusted EBITDA forecast by $30 million to $555 million. These recent developments indicate the company's commitment to enhancing shareholder value and its strategic plan for growth. Additionally, Griffon is actively considering M&A opportunities and plans to manage stock buybacks strategically.
InvestingPro Insights
Amidst Griffon Corporation's (NYSE: GFF) strategic expansion with the acquisition of Pope, the company's financial health and shareholder value proposition are critical factors for current and potential investors. InvestingPro data reveals a robust financial outlook for Griffon, with a market capitalization of $3.16 billion and a notable Price/Earnings (P/E) Ratio of 15.95. The adjusted P/E ratio for the last twelve months as of Q2 2024 is even more attractive at 14.49, suggesting a potentially undervalued stock given the company's earnings potential.
InvestingPro Tips highlight that Griffon's management has been actively enhancing shareholder value through various initiatives. Notably, the company has been aggressively buying back shares and boasts a high shareholder yield.
Moreover, Griffon has demonstrated a commitment to its dividend, having raised it for four consecutive years and maintained payments for 14 consecutive years. This consistent dividend track record, coupled with a 50% dividend growth in the last twelve months as of Q2 2024, underscores Griffon's dedication to returning value to its shareholders.
Investors looking to delve deeper into Griffon's performance and potential can find more InvestingPro Tips by visiting https://www.investing.com/pro/GFF. With 13 additional tips available, these insights provide a comprehensive analysis of the company's financial standing and future prospects. To access these valuable tips, use the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription, enhancing your investment decision-making process with real-time data and expert analysis.
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