What happened

Until July 2017, Dover Corp (DOV -0.20%) was among the worst-performing industrial stocks. What a difference some months make. Once Dover reversed course after July, there was no looking back -- by December, the stock had locked in a whopping 34.8% gain for 2017. Thank the industrial conglomerate's earnings momentum and a major restructuring in the works.

So what

When Dover released its fiscal 2016 earnings report earlier in 2017, it already gave investors much to look forward to when it guided for 10% to 12% growth in sales and 8% growth in earnings per share (EPS) for fiscal 2017. Dover, however, didn't see what was coming.

As the year progressed, Dover experienced stronger-than-expected sales momentum across all of its four business segments: engineered systems (industrials and fast-moving consumer goods), energy, fluids (pumps and filtration systems), and refrigeration and food equipment. Encouraged by strong end-market business conditions, Dover raised its full-year earnings outlook for the second time in the year in July. That's when Dover stock caught investor attention, as the outlook bump-up wasn't a small one -- Dover now projected its EPS to grow as much as 32% at the midpoint, backed by 14% to 15% growth in revenue.

A man pointing at a rising stock chart.

Image source: Getty Images.

Dover had already laid the foundation for growth when it went on an acquisition spree in 2016, acquiring six companies for a net cash consideration of $1.56 billion. Not surprisingly, acquisitions are expected to boost Dover's revenue by nearly 10% in FY 2017.

Dover's operational performance, however, wasn't the only factor that got the market excited. Management gave investors an even bigger reason to cheer when it announced the potential separation of its upstream energy business, also known as Wellsite, which had, so far, been a major drag on the company's top and bottom lines. As of the latest update, Dover will spin off Wellsite into a stand-alone publicly traded company by the second quarter of this year.

Now what

Dover is growing at a torrid pace, and its decision to spin off its energy business should further reduce volatility in earnings while management focuses on its core businesses that can ride the ongoing momentum in the industrials sector.

Investors should also know that Dover is among the most-prized dividend stocks for income investors, and don't see a chance that its Wellsite spinoff should put the stock's Dividend Aristocrat status in jeopardy. Dover's core businesses, after all, look strong enough to be able to support earnings and dividend growth.