Pump maker Flowserve misses Q2 sales estimates, terminates Chart Industries merger

Overview

• Flowserve Q2 sales miss analyst expectations, adjusted EPS beats estimates, per LSEG data

• Company increases full-year 2025 adjusted EPS guidance, reflecting strategic confidence

• Flowserve terminates merger with Chart Industries, receives $266 mln termination payment

Outlook

• Flowserve raises full-year 2025 adjusted EPS guidance to $3.25-$3.40

• Company expects 2025 organic sales growth of 3% to 4%

• Flowserve sees total sales growth of 5% to 6% for 2025

• Company maintains capital expenditures guidance at $80 mln to $90 mln

Result Drivers

• 3D GROWTH STRATEGY - Strong qtr results attributed to successful execution of 3D Growth Strategy and Flowserve Business System, per CEO Scott Rowe

• MARGIN EXPANSION - Operating margin increased by 180 basis points and adjusted operating margin by 210 basis points compared to last year

• AFTERMARKET BOOKINGS - Durable aftermarket bookings reached $621 mln, contributing to overall sales growth

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 10 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy"

• Wall Street's median 12-month price target for Flowserve Corp is $64.50, about 14.9% above its July 28 closing price of $54.86

• The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 15 three months ago

Press Release: ID:nBw5xhY8Ya