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Reasons to Add Ingersoll Rand (IR) Stock to Your Portfolio Now
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Ingersoll Rand Inc. (IR - Free Report) is poised to gain from the solid momentum in its businesses, strong product portfolio, strategic acquisitions and a sound capital-deployment strategy. The company remains focused on investing in growth opportunities and strengthening its long-term market position.
This Zacks Rank #2 (Buy) company has a market capitalization of $37 billion. In the past year, the stock has risen 38.5% compared with the industry’s 11.7% growth.
Image Source: Zacks Investment Research
Let’s delve into the factors that make this company investment-worthy at the moment.
Business Strength: Ingersoll Rand continues to witness higher orders across its product portfolio of industrial vacuums and blowers along with stable orders for compressors, which will drive the Industrial Technologies & Services segment. Growth in short-cycle orders along with strong book-and-ship orders are likely to be tailwinds for the Precision and Science Technologies segment. For 2024, IR expects total revenues to increase in the band of 4-6% year over year while organic revenues are estimated to rise 2-4%.
Benefits From Acquisitions: In June 2024, Ingersoll Rand completed the acquisition of ILC Dover. The inclusion of ILC Dover’s single-use solutions in biopharma and pharma production processes will complement IR’s expertise in liquid handling technologies and positive displacement pumps.
The company’s acquisition of Friulair in February 2024 strengthened its air dryer business and added new chiller production capabilities, thereby boosting its Industrial Technologies and Services segment. The buyout enhanced IR’s presence across food and beverage, and pharmaceutical end markets. Also, in October 2023, it acquired Slovakia-based Oxywise and Canada-based Fraserwoods, thus boosting its capabilities in the high-growth, sustainable end markets. In the first quarter, acquisitions contributed 3.4% to total revenues.
Healthy Liquidity Position: IR’s strong liquidity position adds to its strength. For instance, exiting first-quarter 2024, Ingersoll Rand’s cash and cash equivalents totaled $1.5 billion, significantly higher than its short-term borrowings and current maturities of $31.3 million. This implies that the company has adequate cash to meet its short-term debt obligations.
Also, strong free cash flow generation supports the company’s capital deployment policies. In the first three months of 2024, it generated a free cash flow of $99.3 million, representing growth of 32.9% year over year.
Shareholder-Friendly Policies: Ingersoll Rand is committed to rewarding shareholders through dividend payouts and share repurchases. In 2023, the company paid dividends of $32.4 million and repurchased shares worth $263 million. Also, in the first quarter, it paid out dividends of $8.1 million and bought back shares worth $72.9 million.
Other Key Picks
Other top-ranked companies from the same space are discussed below:
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Reasons to Add Ingersoll Rand (IR) Stock to Your Portfolio Now
Ingersoll Rand Inc. (IR - Free Report) is poised to gain from the solid momentum in its businesses, strong product portfolio, strategic acquisitions and a sound capital-deployment strategy. The company remains focused on investing in growth opportunities and strengthening its long-term market position.
This Zacks Rank #2 (Buy) company has a market capitalization of $37 billion. In the past year, the stock has risen 38.5% compared with the industry’s 11.7% growth.
Image Source: Zacks Investment Research
Let’s delve into the factors that make this company investment-worthy at the moment.
Business Strength: Ingersoll Rand continues to witness higher orders across its product portfolio of industrial vacuums and blowers along with stable orders for compressors, which will drive the Industrial Technologies & Services segment. Growth in short-cycle orders along with strong book-and-ship orders are likely to be tailwinds for the Precision and Science Technologies segment. For 2024, IR expects total revenues to increase in the band of 4-6% year over year while organic revenues are estimated to rise 2-4%.
Benefits From Acquisitions: In June 2024, Ingersoll Rand completed the acquisition of ILC Dover. The inclusion of ILC Dover’s single-use solutions in biopharma and pharma production processes will complement IR’s expertise in liquid handling technologies and positive displacement pumps.
The company’s acquisition of Friulair in February 2024 strengthened its air dryer business and added new chiller production capabilities, thereby boosting its Industrial Technologies and Services segment. The buyout enhanced IR’s presence across food and beverage, and pharmaceutical end markets. Also, in October 2023, it acquired Slovakia-based Oxywise and Canada-based Fraserwoods, thus boosting its capabilities in the high-growth, sustainable end markets. In the first quarter, acquisitions contributed 3.4% to total revenues.
Healthy Liquidity Position: IR’s strong liquidity position adds to its strength. For instance, exiting first-quarter 2024, Ingersoll Rand’s cash and cash equivalents totaled $1.5 billion, significantly higher than its short-term borrowings and current maturities of $31.3 million. This implies that the company has adequate cash to meet its short-term debt obligations.
Also, strong free cash flow generation supports the company’s capital deployment policies. In the first three months of 2024, it generated a free cash flow of $99.3 million, representing growth of 32.9% year over year.
Shareholder-Friendly Policies: Ingersoll Rand is committed to rewarding shareholders through dividend payouts and share repurchases. In 2023, the company paid dividends of $32.4 million and repurchased shares worth $263 million. Also, in the first quarter, it paid out dividends of $8.1 million and bought back shares worth $72.9 million.
Other Key Picks
Other top-ranked companies from the same space are discussed below:
Applied Industrial Technologies, Inc. (AIT - Free Report) presently sports a Zacks Rank #1 (Strong Buy). It has a trailing four-quarter average earnings surprise of 8.2%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has improved 0.9% in the past 60 days. The stock has risen 25.6% in the past year.
Flowserve Corporation (FLS - Free Report) presently sports a Zacks Rank of 1 and has a trailing four-quarter earnings surprise of 21.7%, on average.
The consensus estimate for FLS’ 2024 earnings has increased 0.8% in the past 60 days. Shares of Flowserve have gained 22.1% in the past year.
Crane Company (CR - Free Report) presently carries a Zacks Rank of 2. CR delivered a trailing four-quarter earnings surprise of 15.2%, on average.
The Zacks Consensus Estimate for Crane’s 2024 earnings has advanced 0.8% in the past 60 days. Its shares have surged 56.1% in the past year.