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IDEX Corporation (IEX - Free Report) is likely to gain from a diversified business structure, execution abilities, growth investments (including higher exposure in the emerging markets, productivity enhancement and digitization) and a solid product portfolio. Solid orders, backlog and pricing actions are also anticipated to be beneficial.
For 2022, IEX anticipates strength in industrial and improvements in the chemical and energy markets to benefit the Fluid & Metering Technologies segment. Solid business in the semiconductor and life sciences markets as well as recovery in automotive is likely to be beneficial for the Health & Science Technologies segment. IEX expects a total revenue rise of 6-9% and year-over-year organic sales growth of 5-8% for the same time period.
The company believes in strengthening its businesses through addition of assets. IEX acquired Nexsight, LLC and its WinCan, Envirosight, MyTana and Pipeline Renewal Technologies businesses in March 2022 besides Airtech Group plus US Valve Corporation and other entities in June 2021. Its acquisition of Abel Pumps L.P. (March 2021) added strength to IEX’s pump platform within the Fluid & Metering Technologies segment. It is worth noting that the acquired assets boosted IEX’s revenues 5% in the fourth quarter of 2021. IEX expects acquisitions to contribute 4% and 2% to revenue growth in the first quarter and 2022, respectively.
IDEX focuses on rewarding its shareholders through dividend payments. For instance, in 2021, IEX paid out dividends worth $161.1 million. IEX’s quarterly dividend rate was last hiked in May 2021, with an increase of 8%.
However, supply-chain woes, high corporate expenses and other pandemic-related problems might affect IDEX’s performance in the near term. In fourth-quarter 2021, its cost of sales went 15.9% north, while selling, general and administrative expenses, and corporate expenses increased 21.1% and 29.6%, respectively, year over year.
Further, IDEX is exposed to the risks stemming from its presence in the multiple end markets. IEX expects risks related to the lag in large projects to impact the Fluid & Metering Technology segment in the first half of 2022. Also, in 2022, softness across fire-rescue automotive markets and slowing paint capital investment are expected to hurt the Fire & Safety/Diversified Products segment.
Image Source: Zacks Investment Research
In the past three months, this currently Zacks Rank #3 (Hold) stock has decreased 11.6% compared with the industry’s decline of 10.1%.
Stocks to Consider
Some better-ranked companies from the Zacks Industrial Products sector are discussed below.
Alcoa Corporation (AA - Free Report) presently sports a Zacks Rank #1 (Strong Buy). Its earnings surprise in the last four quarters was 27.1%, on average.
In the past 60 days, AA’s earnings estimates have increased 86.7% for 2022. Alcoa’s shares have gained 40% in the past three months.
Ferguson plc (FERG - Free Report) presently carries a Zacks Rank #2 (Buy). Its earnings surprise in the last four quarters was 14.2%, on average.
In the past 60 days, earnings estimates for FERG have increased 7% for fiscal 2022 (ending July 2022). The stock has declined 24.2% in the past three months.
AGCO Corporation (AGCO - Free Report) presently carries a Zacks Rank of #2. AGCO delivered a trailing four-quarter earnings surprise of 56.7%, on average.
Earnings estimates for AGCO have increased 10.7% for 2022 in the past 60 days. Its shares have rallied 12.6% in the past three months.
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IDEX's (IEX) Strong Prospects Promise Growth, Risks Linger
IDEX Corporation (IEX - Free Report) is likely to gain from a diversified business structure, execution abilities, growth investments (including higher exposure in the emerging markets, productivity enhancement and digitization) and a solid product portfolio. Solid orders, backlog and pricing actions are also anticipated to be beneficial.
For 2022, IEX anticipates strength in industrial and improvements in the chemical and energy markets to benefit the Fluid & Metering Technologies segment. Solid business in the semiconductor and life sciences markets as well as recovery in automotive is likely to be beneficial for the Health & Science Technologies segment. IEX expects a total revenue rise of 6-9% and year-over-year organic sales growth of 5-8% for the same time period.
The company believes in strengthening its businesses through addition of assets. IEX acquired Nexsight, LLC and its WinCan, Envirosight, MyTana and Pipeline Renewal Technologies businesses in March 2022 besides Airtech Group plus US Valve Corporation and other entities in June 2021. Its acquisition of Abel Pumps L.P. (March 2021) added strength to IEX’s pump platform within the Fluid & Metering Technologies segment. It is worth noting that the acquired assets boosted IEX’s revenues 5% in the fourth quarter of 2021. IEX expects acquisitions to contribute 4% and 2% to revenue growth in the first quarter and 2022, respectively.
IDEX focuses on rewarding its shareholders through dividend payments. For instance, in 2021, IEX paid out dividends worth $161.1 million. IEX’s quarterly dividend rate was last hiked in May 2021, with an increase of 8%.
However, supply-chain woes, high corporate expenses and other pandemic-related problems might affect IDEX’s performance in the near term. In fourth-quarter 2021, its cost of sales went 15.9% north, while selling, general and administrative expenses, and corporate expenses increased 21.1% and 29.6%, respectively, year over year.
Further, IDEX is exposed to the risks stemming from its presence in the multiple end markets. IEX expects risks related to the lag in large projects to impact the Fluid & Metering Technology segment in the first half of 2022. Also, in 2022, softness across fire-rescue automotive markets and slowing paint capital investment are expected to hurt the Fire & Safety/Diversified Products segment.
Image Source: Zacks Investment Research
In the past three months, this currently Zacks Rank #3 (Hold) stock has decreased 11.6% compared with the industry’s decline of 10.1%.
Stocks to Consider
Some better-ranked companies from the Zacks Industrial Products sector are discussed below.
Alcoa Corporation (AA - Free Report) presently sports a Zacks Rank #1 (Strong Buy). Its earnings surprise in the last four quarters was 27.1%, on average.
You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, AA’s earnings estimates have increased 86.7% for 2022. Alcoa’s shares have gained 40% in the past three months.
Ferguson plc (FERG - Free Report) presently carries a Zacks Rank #2 (Buy). Its earnings surprise in the last four quarters was 14.2%, on average.
In the past 60 days, earnings estimates for FERG have increased 7% for fiscal 2022 (ending July 2022). The stock has declined 24.2% in the past three months.
AGCO Corporation (AGCO - Free Report) presently carries a Zacks Rank of #2. AGCO delivered a trailing four-quarter earnings surprise of 56.7%, on average.
Earnings estimates for AGCO have increased 10.7% for 2022 in the past 60 days. Its shares have rallied 12.6% in the past three months.