Ingersoll Rand products and brands range from air and gas compression products to fluid management systems. If you think you might want to invest in this popular company, it helps to learn all about it before investing.
Remember the history of Ingersoll Rand Inc. (NYSE: IR), current products, pros and cons of investing and more. We help you decide whether it deserves a place in your dividend shares portfolio.
About Ingersoll Rand
Headquartered in Davidson, North Carolina, Ingersoll Rand has a history dating back to the 1870s. In 1872, the Rand & Waring Drill & Compressor Company was founded. in 1890,
Ingersoll Sergeant introduced the first direct-connect, electrically driven compressor. In 1929 the company introduced the Type-30 compressor and in 1949 produced the first gas turbine driven pipeline compressor.
The Gardner Governor Company introduced speed controls for steam engines, called flyball governor, in 1859 and paved the way for the creation of air compressors. The Gardner Governor Company merged with the Denver Rock Drill Company in 1927 to form Gardner-Denver.
In April 2019, Ingersoll-Rand Plc and Gardner Denver Holdings Inc. that Ingersoll Rand’s industrial segment would split off and merge with Gardner Denver.
Today, Ingersoll Rand Inc. global air, fluid, energy, special vehicles and medical technologies. It designs, produces, sells and provides services:
- Air and Gas Compression Products
- Vacuum and Blow Products
- Liquid Transfer Equipment and Loading Systems
- Power Tools and Lifting Equipment
- Specialized Displacement Pumps
- Fluid Management Systems
- Accessories and aftermarket parts
Products are used in a wide variety of industries from medical to food and beverage to agricultural industries. The different brands include:
- Ingersoll Rand
- Gardner Denver
- club car
- Elmo Rietschlea
- Milton Roy
- Emco Wheaton
- Runtech Systems
- Air Dimensions
- Zinnser Analytical
Advantages and Disadvantages of Investing in Ingersoll Rand Inc.
Let’s take a look at a few reasons why you might want to add Ingersoll Rand to your portfolio and why you might consider not investing in the company’s stock.
The Benefits of Investing in Ingersoll Rand Inc. include:
- Healthy Payout Ratio: Ingersoll Rand pays an annual dividend of $0.08 per share with a dividend yield of 0.2%. The company pays out 4.4% of its profits as dividend. The company has a healthy payout ratio and should be able to cover its dividend payments for years to come. Ingersoll paid dividends worth $8.2 million in the first three months of 2022 and repurchased shares worth $101.1 million.
- Strong financial position: Ingersoll Rand, for its high diversification (including industrial machinery, logistics, electronics and more) with geographic diversification based business. The company has $3.2 billion in liquidity, $247 million in cash flow from operating activities from continuing operations and has $23 million invested in capital expenditures. The company has free cash flow of $224 million. Net debt to leverage adjusted EBITDA was 1.1x for the fourth quarter, an improvement of 0.9x compared to the prior year. All this liquidity can help the company meet its financial obligations.
- Innovation: The company’s ability to innovate in the digital and industrial Internet of Things (IoT) and e-commerce space will always provide it with opportunities to expand its business. As it continues to make acquisitions, it will likely continue to grow its sales.
Check out the downsides you may want to consider before choosing to invest in Ingersoll Rand:
- International tensions: International tensions affect sales of many US products, including at companies such as Ingersoll, Boeing and GE. The conflict between Russia and Ukraine has impacted the global supply chain, hurting the flow of goods, driving cost increases and more.
- Weak Dividend Strength: Ingersoll Rand has a dividend yield of 0.18%, which is in the bottom 25% of all stocks that pay dividends, and the company doesn’t have a long track record of dividend growth either.
- Negative ESG Impact: Ingersoll Rand’s negative impact in the GHG emissions category appears to be primarily caused by its gasoline commercial vehicles, diesel commercial vehicles, gasoline light commercial vehicles, diesel light commercial vehicles, engine starting systems and hydraulic lifts.
Learn more: Dividend Stocks for Income: Can You Live on Dividend Stocks?
How to invest in Ingersoll Rand Inc.
If you are sure you want to buy Ingersoll Rand, your first step is to choose a brokerage and then decide how much money you want to invest. At the time of writing, the stock was $44.52 per share. If your brokerage allows you to buy fractional shares, you may be able to buy partial shares of the shares.
Once you’ve determined the number of stocks you want to invest in, look at the different order types that might suit your needs. The order type helps you determine how a broker should trade your stock. Most likely you will choose a market order, which means trading at the available market price, as most buy-and-hold investors are not necessarily interested in daily or even hour-to-hour price action. However, other order types include a limit order (where you specify the buy or sell price), a stop order (where you buy or sell or sell a stock when the stock price goes above or below a certain price), a stop-limit order (combines features of a stop and limit order) and a stop-loss order (allows you to limit losses by selling your shares when the price falls to or below a certain level you specified).
Once you are ready to invest, double check the number of shares you wish to buy and the ticker symbol and click the “buy” button.
Ingersoll Rand can boost your portfolio
If you’re looking for a reasonably priced powerhouse, Ingersoll Rand can give you the dividends you want. Consider your goals, the company’s trajectory and other factors before choosing Ingersoll Rand as part of your investment strategy. Consider diversifying your investments so that you have a wide variety of options and investments at your disposal.
Read more: 6 best dividend stocks of all time and 11 high-yielding dividend stocks