FLOWSERVE CORP (FLS) - Comprehensive Stock Analysis & Investment Research
Deep dive into FLOWSERVE CORP's business profile, financial performance, AI predictions, and competitive positioning to make informed investment decisions.
FLOWSERVE CORP Investment Summary
When evaluating whether FLOWSERVE CORP (FLS) represents a compelling investment opportunity, investors must consider multiple factors including the company's financial health, market position, growth prospects, and what our AI-powered predictive models suggest about its near-term price trajectory.
Company Profile
FLOWSERVE CORP (FLS) operates within the Technology sector, specifically in the Pumps & Pumping Equipment industry. The company employs approximately 12,472 people. With a market capitalization of $9 billion, the company is a mid-cap stock that typically offers a balance between growth potential and established business operations.
Financial Performance Analysis
FLOWSERVE CORP generates annual revenues of approximately $-3377 million. The company operates with a net margin of 2.7%, showing modest profitability.
From a profitability standpoint, the company has a Return on Equity (ROE) of 5.5%, suggesting room for improvement in capital efficiency. The Return on Assets (ROA) stands at 2.0%, suggesting potential for operational improvement. The gross margin of 28.8% suggests a competitive or commodity-driven business model.
Balance Sheet Strength
Examining the balance sheet health, the current ratio of 2.07x indicates excellent short-term liquidity, meaning the company can comfortably cover its near-term obligations. The debt-to-equity ratio of 0.80x indicates moderate leverage, typical for many established companies.
Cash Flow Generation
FLOWSERVE CORP generates $129 million in annual free cash flow, providing financial flexibility for dividends, share buybacks, debt reduction, or strategic investments. Operating cash flow stands at $187 million, demonstrating the company's ability to generate cash from its core business operations. Year-over-year operating cash flow has changed by -0.7%, which merits investor attention.
Valuation Analysis
The P/E ratio of 20.5x represents a reasonable valuation that balances current earnings with growth expectations, falling within a typical range for established companies. The price-to-book ratio stands at 4.10x, indicating the market values the company above its book value, typical for profitable enterprises. For income-focused investors, the current dividend yield of 1.19% offers modest income, with the company likely retaining more earnings for growth.
AI-Powered Price Predictions
Investment Considerations
When determining whether FLOWSERVE CORP is a suitable investment, consider your investment objectives, risk tolerance, and time horizon. As a mid-cap stock, FLOWSERVE CORP may offer a balance of growth potential and established business fundamentals.
This analysis is generated automatically using our proprietary AI systems and should not be considered personalized investment advice. Past performance does not guarantee future results. Always conduct your own research and consider consulting a financial advisor before making investment decisions.
Corporate Identity
FLOWSERVE CORP (Stock Symbol: FLS) is a prominent company operating within the Technology sector, with a specific focus on the Pumps & Pumping Equipment industry. The company's shares are publicly traded on the NYSE exchange.
Leadership & Workforce
The organization employs approximately 12,472 professionals worldwide, demonstrating a significant operational footprint and the capacity to support substantial business operations across multiple markets.
Market Classification
With a market capitalization of $9 billion, FLOWSERVE CORP is classified as a mid-cap stock. Mid-cap companies often represent businesses in a growth phase, having moved beyond the early startup stage but still possessing significant expansion potential. These stocks can offer an attractive balance between the growth potential of smaller companies and the stability of larger corporations.
Sector & Industry Context
Operating within the Technology sector, FLOWSERVE CORP is subject to the unique dynamics, opportunities, and challenges that characterize this segment of the economy. The technology sector is known for rapid innovation, high growth potential, and competitive intensity. Companies in this sector must continuously invest in research and development to maintain their competitive edge.
Revenue & Growth Analysis
FLOWSERVE CORP generates annual revenues of $-3377 million , representing an emerging company in its growth phase. While smaller in scale, such companies often offer higher growth potential as they capture market share and expand their operations.
Profitability Analysis
The company achieves a 2.7% net profit margin, reflecting thin profitability that may be characteristic of the industry or indicative of competitive pressures. Companies operating at these margins have limited buffer against economic downturns or cost increases.
Gross profit margin stands at 28.8%, a moderate margin common in manufacturing, retail, or distribution-heavy businesses where competition or cost structures limit pricing flexibility.
Operating margin is 5.8%, indicating moderate operational leverage where fixed costs consume a significant portion of gross profits.
Market Valuation
Current market capitalization stands at $9 billion . This mid-cap classification represents companies that have proven their business models but still have significant growth runway. Mid-caps often offer an attractive blend of growth potential and established operations.
Return on Investment Metrics
Return on Equity (ROE) measures 5.5%, suggesting below-average capital efficiency that may reflect industry characteristics, high equity base, or operational challenges.
Return on Assets (ROA) stands at 2.0%, indicating lower asset efficiency that may reflect industry norms or opportunities for operational improvement.
Return on Invested Capital (ROIC) measures 3.9%, which may indicate returns below the cost of capital, potentially destroying shareholder value over time if sustained.
Cash Flow Generation
Free cash flow generation of $129 million annually represents healthy cash conversion that supports ongoing operations and provides capital for growth initiatives or shareholder returns.
Operating cash flow reaches $187 million , with year-over-year growth of -0.7%. Operating cash flow represents the cash generated from core business operations before capital investments, providing insight into the sustainability of the company's business model.
Strategic Market Position
FLOWSERVE CORP strategically competes in the highly dynamic Pumps & Pumping Equipment marketplace. As a mid-cap company, it occupies an attractive position balancing growth potential with established operations. Mid-caps often represent the 'sweet spot' for investors seeking companies that have proven their business models but still have meaningful runway for expansion. These companies are large enough to have competitive advantages but nimble enough to adapt quickly to market changes.
Industry Competitive Landscape
FLOWSERVE CORP operates within the fast-evolving technology sector where competitive dynamics are shaped by innovation cycles, platform economics, and network effects. Technology companies must continuously invest in R&D to maintain relevance, while also defending against disruption from startups and adjacent market entrants. Success in this sector often requires achieving critical scale or establishing defensible intellectual property positions.
Operational Efficiency
The company shows positive operational efficiency through free cash flow generation of $129 million annually , with year-over-year cash flow growth of -0.7%. Positive free cash flow indicates the business generates more cash than required for operations and capital investments, providing resources for growth initiatives or shareholder returns.
Margin & Pricing Power Analysis
The company maintains a 28.8% gross margin reflecting moderate pricing power typical of many manufacturing, retail, or service businesses. While not exceptionally high, these margins provide adequate room for operating expenses and profit generation. Competitive pressures or cost increases could impact profitability if margins compress.
Operating margin of 5.8% demonstrates how efficiently the company converts revenues into operating profits after accounting for all operating expenses including research and development, sales and marketing, and general administrative costs. Operating margin compression relative to gross margin suggests high operating expenses that may warrant efficiency improvements or reflect necessary growth investments.
Asset Utilization Efficiency
Asset turnover ratio of 0.74x indicates moderate asset turnover common in capital-intensive industries such as utilities, real estate, or heavy manufacturing. Lower turnover in these sectors is expected due to the significant infrastructure required for operations.
Financial Strength & Leverage
Current ratio of 2.07 demonstrates strong short-term liquidity with current assets significantly exceeding current liabilities. This provides a substantial buffer for meeting near-term obligations and handling unexpected financial needs.