Graco Inc. (GGG), a leading producer of fluid handling equipment, recently launched Diesel Exhaust Fluid (DEF) dispensing solutions that facilitate clean and hygienic disposal of DEF for garage and heavy equipment maintenance facility. The products are expected to create a niche market for Graco and complement its portfolio of durable, high-quality pump packages that reduce vehicle emissions in automobiles, buses, heavy-duty trucks, and off-road vehicles. Share prices inched marginally with the news of this product launch to close at $80.85 as on Nov 25, 2014.
DEF solutions are non-hazardous and colorless in nature with a chemical composition of high purity urea dissolved and suspended within de-ionized water. It is used as a consumable in selective catalytic reduction (SCR) technology-compatible diesel engines in order to lower NOx (Nitrogen Oxide) concentration in exhaust emissions.
The new product is in compliance with the Environmental Protection Agency (EPA) mandate introduced in 2010 to improve air quality. The EPA aims to strictly control the emission standards of modern light- and heavy-duty diesel engines by significantly reducing engine emissions of NOx and particulate matter. This is mostly achieved by SCR technology that utilizes DEF to convert harmful and toxic NOx gases into harmless nitrogen gas emissions.
Graco’s DEF solutions are likely to augment its revenues and strengthen its position in the market. Headquartered in Minneapolis, MN, Graco is an industrial manufacturer that supplies technology and expertise for management of fluids in both industrial and commercial applications. Graco specializes in making fluid-handling equipment and systems, with one of its best known products being the spray gun used to apply paint to homes, businesses and cars. In spite of its focus on a particular product, the company has a highly diversified revenue stream and enjoys a global customer base. Its products are used in the manufacturing of a broad range of finished goods worldwide.
Graco currently has a Zacks Rank #3 (Hold). Some better-ranked stocks that look promising and are worth a look now include EnPro Industries, Inc. (NPO), Tennant Parker-Hannifin Corporation (PH) and Middleby Corp (MIDD), each carrying a Zacks Rank #2 (Buy).
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