Earnings to watch: Flowserve (FLS) reports Q3 results tomorrow

Adam Hejl /

Flow control equipment manufacturer Flowserve (NYSE:FLS) will be announcing earnings results this Wednesday after market close. Here’s what investors should know.

Flowserve beat analysts’ revenue expectations last quarter, reporting revenues of $1.17 billion, down 1.6% year on year. It was a mixed quarter for the company, with full-year EPS guidance beating analysts’ expectations but revenue guidance for next quarter missing analysts’ expectations significantly.

Is Flowserve a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, the market is expecting Flowserve’s revenue to grow 5.3% year on year, improving from the 3.6% increase it recorded in the same quarter last year.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Flowserve has missed Wall Street’s revenue estimates multiple times over the last two years.

Looking at Flowserve’s peers in the industrial machinery segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Gorman-Rupp delivered year-on-year revenue growth of 11.8%, beating analysts’ expectations by 6.4%, and Graco reported revenues up 7.9%, falling short of estimates by 0.8%. Gorman-Rupp traded up 6.9% following the results while Graco was down 15.3%.

Read our full analysis of Gorman-Rupp’s results here and Graco’s results here.

Over the past year, investors have repeatedly shifted their focus from one macro narrative to another (AI disruption and AI capex spending to geopolitics, interest rates, and the broader health of the economy). While some of the industrial machinery stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 4.2% on average over the last month. Flowserve is down 5.7% during the same time and is heading into earnings with an average analyst price target of $87.60 (compared to the current share price of $69.17).

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