How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.

The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.

What if you'd invested in Applied Industrial Technologies (AIT) ten years ago? It may not have been easy to hold on to AIT for all that time, but if you did, how much would your investment be worth today?

Applied Industrial Technologies' Business In-Depth

With that in mind, let's take a look at Applied Industrial Technologies' main business drivers.

Applied Industrial Technologies, Inc. is a distributor of value-added industrial products — including engineered fluid power components, bearings, specialty flow control solutions, power transmission products and miscellaneous industrial supplies. These products are mainly sold to original equipment manufacturers (OEM) and maintenance, repair, and operations (MRO) customers in Australia, North America, Singapore and New Zealand.

The company is also well known in the market for its engineering, design and systems integration services, as well as its inventory management solutions and maintenance training services that boost the value of end users in the market. The company, founded in 1923, is currently headquartered in Cleveland, OH.

Applied Industrial has operations in the United States, Canada and other countries (Mexico, Australia, New Zealand and Singapore), generating 87.5%, 7.1%, and 5.4% of fiscal 2023 revenues, respectively. Exiting fiscal 2023, the company had an employee base of 6,200 people.

Applied Industrial reports revenues under two business segments. A brief discussion on the segments is provided below:

Service Center Based Distribution (68% of net revenues in fiscal 2024) segment offers different types of industrial products majorly through service centers in New Zealand, Australia and North America. Some of the products offered by the segment include industrial bearings, motors, belting, drives, couplings and pumps.

This segment also provides services in the oil and gas industry as well as includes operations of fabricated rubber shops (regional) and rubber service field crews. Service offerings of Applied Maintenance Supplies & Solutions come under the ambit of this segment.

The Engineered Solutions segment (formerly Fluid Power & Flow Control) (32%) includes specialized regional businesses that offer fluid power components, assembling and designing of fluid power systems, and equipment repairing services. These products and services are traded to the end-users directly in the absence of any service centers. In addition, the segment offers integration of flow control systems, pump repair and other services.

Bottom Line

Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Applied Industrial Technologies ten years ago, you're likely feeling pretty good about your investment today.

According to our calculations, a $1000 investment made in January 2015 would be worth $6,382.10, or a 538.21% gain, as of January 20, 2025. Investors should keep in mind that this return excludes dividends but includes price appreciation.

In comparison, the S&P 500 gained 196.95% and the price of gold went up 100.70% over the same time frame.

Analysts are forecasting more upside for AIT too.

Applied Industrial is benefiting from an improving product line and value-added services, particularly from the increasing demand across the U.S. manufacturing sector for its fluid power MRO services. Acquired assets are another positive factor driving the company’s top line. Strength across the food and beverage, primary metals, utilities and transportation end markets sparks optimism. In addition, pricing actions and freight savings, among a host of other factors, are improving its profitability. Its efforts to reward its shareholders add to its appeal. However, there remain some pockets of weakness in fluid power components. The rising cost of sales, due to the increase in compensation related costs, poses a threat to the bottom line. Given its international presence, forex woes are weighing on Applied Industrial’s top line.

The stock has jumped 6.99% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 1 higher, for fiscal 2024; the consensus estimate has moved up as well.

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