Q2 Earnings Outperformers: Donaldson (NYSE:DCI) And The Rest Of The Gas and Liquid Handling Stocks
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Donaldson (NYSE:DCI) and the rest of the gas and liquid handling stocks fared in Q2.
Gas and liquid handling companies possess the technical know-how and specialized equipment to handle valuable (and sometimes dangerous) substances. Lately, water conservation and carbon capture–which requires hydrogen and other gasses as well as specialized infrastructure–have been trending up, creating new demand for products such as filters, pumps, and valves. On the other hand, gas and liquid handling companies are at the whim of economic cycles. Consumer spending and interest rates, for example, can greatly impact the industrial production that drives demand for these companies’ offerings.
The 12 gas and liquid handling stocks we track reported a mixed Q2. As a group, revenues missed analysts’ consensus estimates by 0.9%.
Big picture, the Federal Reserve has a dual mandate of inflation and employment. The former had been running hot throughout 2021 and 2022 but cooled towards the central bank's 2% target as of late. This prompted the Fed to cut its policy rate by 50bps (half a percent) in September 2024. Given recent employment data that suggests the US economy could be wobbling, the markets will be assessing whether this rate and future cuts (the Fed signaled more to come in 2024 and 2025) are the right moves at the right time or whether they're too little, too late for a macro that has already cooled.
In light of this news, gas and liquid handling stocks have held steady with share prices up 1.3% on average since the latest earnings results.
Donaldson (NYSE:DCI)
Playing a vital role in the historic Apollo 11 mission, Donaldson (NYSE:DCI) manufacturers and sells filtration equipment for various industries.
Donaldson reported revenues of $935.4 million, up 6.4% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a decent beat of analysts’ operating margin estimates but underwhelming earnings guidance for the full year.
Unsurprisingly, the stock is down 1.7% since reporting and currently trades at $73.17.
Is now the time to buy Donaldson? Access our full analysis of the earnings results here, it’s free.
Best Q2: Flowserve (NYSE:FLS)
Manufacturing the largest pump ever built for nuclear power generation, Flowserve (NYSE:FLS) manufactures and sells flow control equipment for various industries.
Flowserve reported revenues of $1.16 billion, up 7.1% year on year, outperforming analysts’ expectations by 2.4%. The business had an exceptional quarter with an impressive beat of analysts’ operating margin estimates and a solid beat of analysts’ earnings estimates.
Flowserve delivered the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 2.6% since reporting. It currently trades at $52.22.
Is now the time to buy Flowserve? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Gorman-Rupp (NYSE:GRC)
Powering fluid dynamics since 1934, Gorman-Rupp (NYSE:GRC) has evolved from its Ohio origins into a global manufacturer and seller of pumps and pump systems.
Gorman-Rupp reported revenues of $169.5 million, flat year on year, falling short of analysts’ expectations by 3.8%. It was a disappointing quarter as it posted a miss of analysts’ earnings estimates.
As expected, the stock is down 4.2% since the results and currently trades at $38.93.
Read our full analysis of Gorman-Rupp’s results here.
Chart (NYSE:GTLS)
Installing the first bulk Co2 tank for McDonalds’s sodas, Chart (NYSE:GTLS) provides equipment to store and transport gasses.
Chart reported revenues of $1.04 billion, up 14.6% year on year. This number came in 6.3% below analysts' expectations. It was a slower quarter as it also recorded a miss of analysts’ earnings estimates.
Chart had the weakest performance against analyst estimates among its peers. The stock is down 22.2% since reporting and currently trades at $119.65.
Read our full, actionable report on Chart here, it’s free.
Standex (NYSE:SXI)
Holding over 500 patents globally, Standex (NYSE:SXI) is a manufacturer and distributor of industrial components for various sectors.
Standex reported revenues of $180.2 million, down 4.3% year on year. This number met analysts’ expectations. Taking a step back, it was a mixed quarter as it underperformed in other aspects of the business.
The stock is flat since reporting and currently trades at $180.40.
Read our full, actionable report on Standex here, it’s free.
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