FLOWSERVE CORP (FLS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:FLS - US34354P1057 - Common Stock
77.88 USD
-0.72 (-0.92%)
77.88 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to FLS. FLS was compared to 132 industry peers in the Machinery industry. FLS scores excellent on profitability, but there are some minor concerns on its financial health. FLS has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- In the past year FLS was profitable.
- In the past year FLS had a positive cash flow from operations.
- FLS had positive earnings in each of the past 5 years.
- Of the past 5 years FLS 4 years had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of FLS (7.77%) is better than 73.48% of its industry peers.
- Looking at the Return On Equity, with a value of 20.00%, FLS belongs to the top of the industry, outperforming 87.88% of the companies in the same industry.
- FLS has a better Return On Invested Capital (11.00%) than 76.52% of its industry peers.
- FLS had an Average Return On Invested Capital over the past 3 years of 8.33%. This is in line with the industry average of 10.24%.
- The 3 year average ROIC (8.33%) for FLS is below the current ROIC(11.00%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.77% | ||
| ROE | 20% | ||
| ROIC | 11% |
ROA(3y)4.24%
ROA(5y)3.51%
ROE(3y)11.36%
ROE(5y)9.55%
ROIC(3y)8.33%
ROIC(5y)7.79%
1.3 Margins
- FLS has a Profit Margin of 9.66%. This is in the better half of the industry: FLS outperforms 71.21% of its industry peers.
- FLS's Profit Margin has been stable in the last couple of years.
- FLS's Operating Margin of 11.96% is fine compared to the rest of the industry. FLS outperforms 60.61% of its industry peers.
- FLS's Operating Margin has been stable in the last couple of years.
- With a Gross Margin value of 33.72%, FLS perfoms like the industry average, outperforming 58.33% of the companies in the same industry.
- In the last couple of years the Gross Margin of FLS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.96% | ||
| PM (TTM) | 9.66% | ||
| GM | 33.72% |
OM growth 3Y11.99%
OM growth 5Y0.53%
PM growth 3Y20.37%
PM growth 5Y0.47%
GM growth 3Y2.21%
GM growth 5Y-0.61%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), FLS is creating some value.
- Compared to 1 year ago, FLS has about the same amount of shares outstanding.
- FLS has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, FLS has a worse debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 4.17 indicates that FLS is not in any danger for bankruptcy at the moment.
- FLS's Altman-Z score of 4.17 is fine compared to the rest of the industry. FLS outperforms 65.91% of its industry peers.
- FLS has a debt to FCF ratio of 2.36. This is a good value and a sign of high solvency as FLS would need 2.36 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 2.36, FLS is in the better half of the industry, outperforming 73.48% of the companies in the same industry.
- A Debt/Equity ratio of 0.63 indicates that FLS is somewhat dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.63, FLS is doing worse than 61.36% of the companies in the same industry.
- Even though the debt/equity ratio score it not favorable for FLS, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 2.36 | ||
| Altman-Z | 4.17 |
ROIC/WACC1.14
WACC9.66%
2.3 Liquidity
- FLS has a Current Ratio of 2.10. This indicates that FLS is financially healthy and has no problem in meeting its short term obligations.
- FLS has a Current ratio of 2.10. This is comparable to the rest of the industry: FLS outperforms 53.03% of its industry peers.
- FLS has a Quick Ratio of 1.54. This is a normal value and indicates that FLS is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 1.54, FLS is in the better half of the industry, outperforming 67.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.1 | ||
| Quick Ratio | 1.54 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 20.52% over the past year.
- The Earnings Per Share has been growing slightly by 4.18% on average over the past years.
- The Revenue has been growing slightly by 3.19% in the past year.
- FLS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.96% yearly.
EPS 1Y (TTM)20.52%
EPS 3Y24.77%
EPS 5Y4.18%
EPS Q2Q%30.43%
Revenue 1Y (TTM)3.19%
Revenue growth 3Y8.78%
Revenue growth 5Y2.96%
Sales Q2Q%3.65%
3.2 Future
- The Earnings Per Share is expected to grow by 14.36% on average over the next years. This is quite good.
- Based on estimates for the next years, FLS will show a small growth in Revenue. The Revenue will grow by 3.96% on average per year.
EPS Next Y29.51%
EPS Next 2Y22.04%
EPS Next 3Y18.18%
EPS Next 5Y14.36%
Revenue Next Year4.04%
Revenue Next 2Y4.02%
Revenue Next 3Y4.06%
Revenue Next 5Y3.96%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 24.11, FLS is valued on the expensive side.
- Compared to the rest of the industry, the Price/Earnings ratio of FLS indicates a somewhat cheap valuation: FLS is cheaper than 62.12% of the companies listed in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.21. FLS is around the same levels.
- The Price/Forward Earnings ratio is 19.37, which indicates a rather expensive current valuation of FLS.
- FLS's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. FLS is cheaper than 65.15% of the companies in the same industry.
- FLS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.11 | ||
| Fwd PE | 19.37 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of FLS is on the same level as its industry peers.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of FLS indicates a rather cheap valuation: FLS is cheaper than 83.33% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.74 | ||
| EV/EBITDA | 16.08 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- FLS has a very decent profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as FLS's earnings are expected to grow with 18.18% in the coming years.
PEG (NY)0.82
PEG (5Y)5.77
EPS Next 2Y22.04%
EPS Next 3Y18.18%
5. Dividend
5.1 Amount
- FLS has a Yearly Dividend Yield of 1.07%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 1.01, FLS pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, FLS's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.07% |
5.2 History
- The dividend of FLS has a limited annual growth rate of 2.02%.
- FLS has paid a dividend for at least 10 years, which is a reliable track record.
- FLS has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)2.02%
Div Incr Years1
Div Non Decr Years4
5.3 Sustainability
- FLS pays out 24.35% of its income as dividend. This is a sustainable payout ratio.
- FLS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP24.35%
EPS Next 2Y22.04%
EPS Next 3Y18.18%
FLOWSERVE CORP / FLS FAQ
What is the ChartMill fundamental rating of FLOWSERVE CORP (FLS) stock?
ChartMill assigns a fundamental rating of 6 / 10 to FLS.
What is the valuation status for FLS stock?
ChartMill assigns a valuation rating of 5 / 10 to FLOWSERVE CORP (FLS). This can be considered as Fairly Valued.
How profitable is FLOWSERVE CORP (FLS) stock?
FLOWSERVE CORP (FLS) has a profitability rating of 7 / 10.
What is the valuation of FLOWSERVE CORP based on its PE and PB ratios?
The Price/Earnings (PE) ratio for FLOWSERVE CORP (FLS) is 24.11 and the Price/Book (PB) ratio is 4.37.
Can you provide the financial health for FLS stock?
The financial health rating of FLOWSERVE CORP (FLS) is 6 / 10.