Flowserve: Turning The Corner

Nov. 10, 2022 1:20 PM ETFlowserve Corporation (FLS)SPY
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  • The demand remains robust in the aftermarket business reflecting strong MRO activity requirements, especially in the oil and gas market.
  • The company increased the inventory level to mitigate supply chain constraints and improve the backlog-to-sales conversion rate which should facilitate revenue growth.
  • Ongoing efforts to reduce the SG&A (as a % of net sales) should help in margin expansion in the future.

Bull and bear market


Investment Thesis

Flowserve Corporation (NYSE:FLS) has outperformed the broader markets meaningfully since our previous article last month gaining over 20% versus the S&P 500’s (SPY) ~4% gains. In the third quarter of 2022, Flowserve Corporation recorded an

FLS Bookings and Backlog

FLS Bookings and Backlog (Company Data, GS Analytics Research)

FLS Operating Margin

FLS Operating Margin (Company Data, GS Analytics Research)

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Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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