Oppenheimer analyst Bryan Blair has maintained their neutral stance on FLS stock, giving a Hold rating today.
Bryan Blair’s Hold rating for Flowserve’s stock (FLS) is based on a number of factors. He acknowledges the company’s progress and potential shown in the Analyst Day presentation, particularly in terms of their diversified, decarbonized, and digitized (3D) strategy and revamped operating model. The 3D strategy has already seen early success, as evidenced by significant 2022 bookings growth in all three areas, with 3D orders accounting for 28% of total orders. However, Blair is looking for more assurance in the sustainability of this growth and the conversion of the company’s backlog before changing his rating.
In addition, Blair notes Flowserve’s reaffirmed 2023 sales guidance and positive 2023-24 operating trajectory, backed by a strong backlog and aftermarket traction. Despite these positives, he remains cautious due to the need for more evidence of a long-term, sustainable increase in earnings. He does show interest in the company’s order strength and ongoing 2023 earnings inflection, but these factors are not enough for him to move off the sidelines just yet. In conclusion, while Blair acknowledges Flowserve’s potential, he needs more confidence in the company’s ability to sustain higher earnings before changing his Hold rating.
In another report released today, Morgan Stanley also maintained a Hold rating on the stock with a $43.00 price target.
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Flowserve (FLS) Company Description:
Flowserve Corp. engages in the manufacture and provision of aftermarket service for comprehensive flow control systems. It operates through the following segments: Flowserve Pump Division and Flow Control Division. The Flowserve Pump Division segment provides pumps, pre-configured industrial pumps, pump systems, mechanical seals, auxiliary systems and replacement parts and related services. The Flow Control Division segment involves engineered and industrial valves, control valves, actuators and controls and related services. The company was founded in 1790 and is headquartered in Irving, TX.
Read More on FLS:
- Flowserve a top idea heading into Investor Day, says TD Cowen
- Flowserve upgraded to Buy at Jefferies on margin expansion potential
- Flowserve upgraded to Buy from Hold at Jefferies
- Flowserve free cash flow conversion lagging peers, says RBC Capital
- Flowserve and Velan extend outside date of arrangement agreement
