TacticScaleWhat Donaldson Does & How It Makes Money (DCI)
Updated October 2026 · reflects Donaldson's latest reported financials
Global maker of industrial and engine filtration systems and replacement filters. It sells filtration systems to equipment makers and end users, then earns recurring revenue from replacement filters and parts sold through OEMs, dealer networks, and independent distributors.
How Donaldson makes money
It sells filtration systems to equipment makers and end users, then earns recurring revenue from replacement filters and parts sold through OEMs, dealer networks, and independent distributors. It also earns revenue from monitoring, service, and life sciences equipment and consumables.
What Donaldson does
Donaldson Company, founded in 1915 and based in Bloomington, Minnesota, is a worldwide filtration specialist. It operates three segments: Mobile Solutions, which supplies air and liquid filters, emissions systems, and monitoring for engines in construction, mining, agriculture, and transportation equipment; Industrial Solutions, which covers dust, fume and mist collectors, compressed air and gas purification, power-generation air inlet filtration, and aerospace and defense filtration; and Life Sciences, which provides food, beverage, and process filtration, bioprocessing equipment and consumables, PTFE membrane products, and specialized filtration for hard disk drives, semiconductors, and batteries. Filters wear out and have to be replaced, so much of the business comes from replacement parts sold through OEMs, dealer networks, and independent distributors. Each installed system therefore keeps producing aftermarket sales, with monitoring and service offerings on top.
Products & services
- Engine air, fuel, lube and hydraulic replacement filters
- Dust, fume and mist collectors
- Compressed air and gas purification systems
- Gas turbine air inlet filtration for power generation
- Aerospace and defense filtration
- Bioreactors, fermenters and chromatography consumables
What is Donaldson worth?
On an owner-earnings DCF, Donaldson's most-likely value is about $74 versus a recent price near $87 (15% above fair value). But TacticScale only calls a stock undervalued when the price sits below its conservative no-growth floor (~$37) with a margin of safety — so the honest verdict here is “Fairly priced — no edge.” Fair value earns its keep only at the extremes, not in the wide middle.
Price sits in the normal range — fair value isn't actionable here; it earns its keep only when price drops below the no-growth floor, or runs to roughly double the optimistic case.
Analysis, not advice. Fair value is a margin-of-safety estimate from a deterministic owner-earnings DCF, not a price target or recommendation. See the full breakdown →
Related companies
Dover (DOV) · Atmus Filtration Technologies (ATMU) · Ingersoll Rand (IR) · Nordson (NDSN) · Cummins (CMI)