Middleby (MIDD 0.20%) just let investors know that its business is humming, and that's great timing for shareholders. The stock surged 12.2% as of 12:15 p.m. ET after Middleby beat on earnings and raised guidance.
It comes just two months before the company will restructure into two separate companies. First lets look at how the businesses are doing.
Image source: Getty Images.
Spin-off coming
Middleby said total sales jumped 15%, and 12% on an organic basis. Revenue soared past consensus estimates, and earnings per share also beat expectations. The company had previously sold a majority stake in its residential kitchen business, so now only reports on its commercial foodservice and food processing segments.
Foodservice grew sales by 8.1%, but food processing blew the doors off with 25% growth. That segment will be spun off into a separate company on July 6, with existing shareholders receiving one share of the new company for each share of the current Middleby stock held.
NASDAQ: MIDD
Key Data Points
That move will allow managers of each new company to focus on growing a singular business, helping to unlock value for long-term shareholders. The new company will be called Middleby Food Processing and will trade with the symbol "MFP" beginning after July 6.
Management will hold an investor day next week on May 12 to provide more details on both companies and their growth prospects. It should be a beneficial move for shareholders, as new investors will treat the new companies the same way they treat an initial public offering, providing new investment opportunities.
