FLOWSERVE CORP (FLS) Stock Fundamental Analysis
NYSE:FLS - New York Stock Exchange, Inc. - US34354P1057 - Common Stock - Currency: USD
Taking everything into account, FLS scores 5 out of 10 in our fundamental rating. FLS was compared to 128 industry peers in the Machinery industry. Both the profitability and the financial health of FLS get a neutral evaluation. Nothing too spectacular is happening here. FLS has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
FLS had positive earnings in the past year.
FLS had a positive operating cash flow in the past year.
FLS had positive earnings in each of the past 5 years.
FLS had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
FLS has a Return On Assets (5.15%) which is in line with its industry peers.
FLS's Return On Equity of 13.58% is fine compared to the rest of the industry. FLS outperforms 66.41% of its industry peers.
Looking at the Return On Invested Capital, with a value of 11.05%, FLS is in the better half of the industry, outperforming 73.44% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for FLS is below the industry average of 10.71%.
The 3 year average ROIC (8.33%) for FLS is below the current ROIC(11.05%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.15% | ||
| ROE | 13.58% | ||
| ROIC | 11.05% |
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
Looking at the Profit Margin, with a value of 6.12%, FLS is in line with its industry, outperforming 55.47% of the companies in the same industry.
In the last couple of years the Profit Margin of FLS has remained more or less at the same level.
The Operating Margin of FLS (11.57%) is better than 60.16% of its industry peers.
In the last couple of years the Operating Margin of FLS has remained more or less at the same level.
FLS has a Gross Margin (32.52%) which is in line with its industry peers.
FLS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.57% | ||
| PM (TTM) | 6.12% | ||
| GM | 32.52% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so FLS is still creating some value.
The number of shares outstanding for FLS remains at a similar level compared to 1 year ago.
Compared to 5 years ago, FLS has more shares outstanding
Compared to 1 year ago, FLS has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.77 indicates that FLS is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 3.77, FLS is doing good in the industry, outperforming 62.50% of the companies in the same industry.
FLS has a debt to FCF ratio of 6.39. This is a slightly negative value and a sign of low solvency as FLS would need 6.39 years to pay back of all of its debts.
FLS has a Debt to FCF ratio (6.39) which is comparable to the rest of the industry.
A Debt/Equity ratio of 0.70 indicates that FLS is somewhat dependend on debt financing.
The Debt to Equity ratio of FLS (0.70) is worse than 67.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 6.39 | ||
| Altman-Z | 3.77 |
ROIC/WACC1.11
WACC9.94%
2.3 Liquidity
A Current Ratio of 2.07 indicates that FLS has no problem at all paying its short term obligations.
FLS's Current ratio of 2.07 is in line compared to the rest of the industry. FLS outperforms 51.56% of its industry peers.
FLS has a Quick Ratio of 1.46. This is a normal value and indicates that FLS is financially healthy and should not expect problems in meeting its short term obligations.
FLS has a Quick ratio of 1.46. This is in the better half of the industry: FLS outperforms 64.06% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.07 | ||
| Quick Ratio | 1.46 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 24.56% 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 4.23% in the past year.
Measured over the past years, FLS shows a small growth in Revenue. The Revenue has been growing by 2.96% on average per year.
EPS 1Y (TTM)24.56%
EPS 3Y24.77%
EPS 5Y4.18%
EPS Q2Q%24.14%
Revenue 1Y (TTM)4.23%
Revenue growth 3Y8.78%
Revenue growth 5Y2.96%
Sales Q2Q%5.25%
3.2 Future
Based on estimates for the next years, FLS will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.97% on average per year.
Based on estimates for the next years, FLS will show a small growth in Revenue. The Revenue will grow by 2.72% on average per year.
EPS Next Y19.84%
EPS Next 2Y16.19%
EPS Next 3Y13.66%
EPS Next 5Y9.97%
Revenue Next Year5.42%
Revenue Next 2Y4.54%
Revenue Next 3Y4.04%
Revenue Next 5Y2.72%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.47, which indicates a rather expensive current valuation of FLS.
Compared to the rest of the industry, the Price/Earnings ratio of FLS indicates a somewhat cheap valuation: FLS is cheaper than 69.53% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of FLS to the average of the S&P500 Index (27.45), we can say FLS is valued slightly cheaper.
A Price/Forward Earnings ratio of 15.17 indicates a correct valuation of FLS.
FLS's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. FLS is cheaper than 72.66% of the companies in the same industry.
FLS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.90, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.47 | ||
| Fwd PE | 15.17 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, FLS is valued a bit cheaper than the industry average as 61.72% of the companies are valued more expensively.
FLS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.89 | ||
| EV/EBITDA | 12.87 |
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.
The decent profitability rating of FLS may justify a higher PE ratio.
FLS's earnings are expected to grow with 13.66% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.98
PEG (5Y)4.66
EPS Next 2Y16.19%
EPS Next 3Y13.66%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.62%, FLS has a reasonable but not impressive dividend return.
FLS's Dividend Yield is a higher than the industry average which is at 1.88.
FLS's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
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 39.09% of its income as dividend. This is a sustainable payout ratio.
The dividend of FLS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP39.09%
EPS Next 2Y16.19%
EPS Next 3Y13.66%
55.29
+1.3 (+2.41%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners97.98%
Inst Owner Change0.89%
Ins Owners0.54%
Ins Owner Change12.14%
Market Cap7.23B
Analysts85
Price Target63.75 (15.3%)
Short Float %2.71%
Short Ratio1.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
Yearly Dividend0.84
Dividend Growth(5Y)2.02%
DP39.09%
Div Incr Years1
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.28%
Min EPS beat(2)-9.88%
Max EPS beat(2)18.43%
EPS beat(4)3
Avg EPS beat(4)6.41%
Min EPS beat(4)-9.88%
Max EPS beat(4)18.43%
EPS beat(8)7
Avg EPS beat(8)12.93%
EPS beat(12)10
Avg EPS beat(12)11.18%
EPS beat(16)10
Avg EPS beat(16)1.17%
Revenue beat(2)1
Avg Revenue beat(2)-0.57%
Min Revenue beat(2)-3.25%
Max Revenue beat(2)2.1%
Revenue beat(4)2
Avg Revenue beat(4)-0.02%
Min Revenue beat(4)-3.25%
Max Revenue beat(4)2.1%
Revenue beat(8)6
Avg Revenue beat(8)2.43%
Revenue beat(12)8
Avg Revenue beat(12)2.29%
Revenue beat(16)8
Avg Revenue beat(16)0.82%
PT rev (1m)1.46%
PT rev (3m)-12.59%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.37%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.9%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.88%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.47 | ||
| Fwd PE | 15.17 | ||
| P/S | 1.57 | ||
| P/FCF | 30.89 | ||
| P/OCF | 23.08 | ||
| P/B | 3.48 | ||
| P/tB | 12.21 | ||
| EV/EBITDA | 12.87 |
EPS(TTM)2.84
EY5.14%
EPS(NY)3.65
Fwd EY6.59%
FCF(TTM)1.79
FCFY3.24%
OCF(TTM)2.4
OCFY4.33%
SpS35.3
BVpS15.91
TBVpS4.53
PEG (NY)0.98
PEG (5Y)4.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.15% | ||
| ROE | 13.58% | ||
| ROCE | 13.02% | ||
| ROIC | 11.05% | ||
| ROICexc | 12.73% | ||
| ROICexgc | 21.87% | ||
| OM | 11.57% | ||
| PM (TTM) | 6.12% | ||
| GM | 32.52% | ||
| FCFM | 5.07% |
ROA(3y)4.24%
ROA(5y)3.51%
ROE(3y)11.36%
ROE(5y)9.55%
ROIC(3y)8.33%
ROIC(5y)7.79%
ROICexc(3y)9.82%
ROICexc(5y)9.51%
ROICexgc(3y)17.16%
ROICexgc(5y)16.91%
ROCE(3y)9.81%
ROCE(5y)9.18%
ROICexcg growth 3Y15.64%
ROICexcg growth 5Y2.31%
ROICexc growth 3Y16.8%
ROICexc growth 5Y2.19%
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%
F-Score7
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 6.39 | ||
| Debt/EBITDA | 2.33 | ||
| Cap/Depr | 89.51% | ||
| Cap/Sales | 1.72% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 50.3% | ||
| Profit Quality | 82.84% | ||
| Current Ratio | 2.07 | ||
| Quick Ratio | 1.46 | ||
| Altman-Z | 3.77 |
F-Score7
WACC9.94%
ROIC/WACC1.11
Cap/Depr(3y)86.32%
Cap/Depr(5y)74.19%
Cap/Sales(3y)1.82%
Cap/Sales(5y)1.71%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)24.56%
EPS 3Y24.77%
EPS 5Y4.18%
EPS Q2Q%24.14%
EPS Next Y19.84%
EPS Next 2Y16.19%
EPS Next 3Y13.66%
EPS Next 5Y9.97%
Revenue 1Y (TTM)4.23%
Revenue growth 3Y8.78%
Revenue growth 5Y2.96%
Sales Q2Q%5.25%
Revenue Next Year5.42%
Revenue Next 2Y4.54%
Revenue Next 3Y4.04%
Revenue Next 5Y2.72%
EBIT growth 1Y17.05%
EBIT growth 3Y21.82%
EBIT growth 5Y3.5%
EBIT Next Year35.21%
EBIT Next 3Y15.85%
EBIT Next 5Y11.77%
FCF growth 1Y464.43%
FCF growth 3Y20.83%
FCF growth 5Y6.75%
OCF growth 1Y2245.27%
OCF growth 3Y19.36%
OCF growth 5Y5.59%