Let’s dig into the relative performance of Helios (NYSE: HLIO) and its peers as we unravel the now-completed Q2 gas and liquid handling earnings season.
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 strong Q2. As a group, revenues beat analysts’ consensus estimates by 1.3% while next quarter’s revenue guidance was 2.8% below.
Luckily, gas and liquid handling stocks have performed well with share prices up 11% on average since the latest earnings results.
Best Q2: Helios (NYSE: HLIO)
Founded on the principle of treating others as one wants to be treated, Helios (NYSE: HLIO) designs, manufactures, and sells motion and electronic control components for various sectors.
Helios reported revenues of $212.5 million, down 3.4% year on year. This print exceeded analysts’ expectations by 5.5%. Overall, it was a stunning quarter for the company with a solid beat of analysts’ organic revenue estimates and EPS guidance for next quarter exceeding analysts’ expectations.
“The Helios team continued to execute on our financial priorities to drive sequential operating leverage, improve our cash conversion cycle, reduce debt, and strengthen our earnings power to be better positioned to capitalize on improving demand trends. We generated a near record level of cash which further improved our already strong free cash flow conversion. We used that cash to strengthen our balance sheet as we continued to reduce debt and also return capital to shareholders through our consistent dividend and opportunistic share repurchase of our common stock,” said Sean Bagan, President, Chief Executive Officer and Chief Financial Officer of Helios.
Helios pulled off the biggest analyst estimates beat and highest full-year guidance raise, but had the slowest revenue growth of the whole group. Unsurprisingly, the stock is up 42.7% since reporting and currently trades at $52.55.
Is now the time to buy Helios? Access our full analysis of the earnings results here, it’s free for active Edge members.
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 $179 million, up 5.6% year on year, outperforming analysts’ expectations by 2.5%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA estimates and a beat of analysts’ EPS estimates.
The market seems happy with the results as the stock is up 23.2% since reporting. It currently trades at $46.65.
Is now the time to buy Gorman-Rupp? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q2: Graco (NYSE: GGG)
Founded in 1926, Graco (NYSE: GGG) is an industrial company specializing in the development and manufacturing of fluid-handling systems and products.
Graco reported revenues of $571.8 million, up 3.4% year on year, falling short of analysts’ expectations by 3.1%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income and EPS estimates.
Graco delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 2.8% since the results and currently trades at $84.75.
Read our full analysis of Graco’s results here.
Ingersoll Rand (NYSE: IR)
Started with the invention of the steam drill, Ingersoll Rand (NYSE: IR) provides mission-critical air, gas, liquid, and solid flow creation solutions.
Ingersoll Rand reported revenues of $1.89 billion, up 4.6% year on year. This print surpassed analysts’ expectations by 2.4%. Overall, it was a very strong quarter as it also logged a solid beat of analysts’ adjusted operating income estimates and full-year EBITDA guidance slightly topping analysts’ expectations.
The stock is down 1.5% since reporting and currently trades at $83.41.
Read our full, actionable report on Ingersoll Rand here, it’s free for active Edge members.
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 $222 million, up 23.2% year on year. This number topped analysts’ expectations by 3.5%. It was a very strong quarter as it also produced a beat of analysts’ EPS and EBITDA estimates.
Standex pulled off the fastest revenue growth among its peers. The stock is up 31% since reporting and currently trades at $216.11.
Read our full, actionable report on Standex here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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