Ingersoll Rand Gains From Business Strength & Buyouts Amid Risks

Ingersoll Rand Inc. IR continues to witness higher orders across its product portfolio of industrial vacuums and blowers, and compressors, which is driving the Industrial Technologies & Services (IT&S) segment. The segment’s order totaled $1.56 billion, up 6.5% year over year in the second quarter of 2025.

Strong momentum in the life sciences business, driven by growth in fluid handling product orders within the legacy Gardner Denver Medical platform, is likely to be a tailwind for the Precision and Science Technologies segment. Strength in the precision technologies business also bodes well. The segment reported an order of $378.7 million in the second quarter, up 13.4% year over year.

Driven by strength across its businesses, management expects the company’s 2025 revenues to grow 4-6% from the year-ago level. IR forecasts adjusted earnings of $3.34-$3.46 per share in the same period, indicating approximately flat to 3% year-over-year growth.

The company intends to strengthen and expand its businesses through buyouts. In August 2025, it acquired Dave Barry Plastics, which boosted its life science portfolio. In June 2025, the company acquired Lead Fluid (Baoding) Intelligent Equipment Manufacturing Co., Ltd (Lead Fluid), which boosted its life science business in China. Also, in April 2025, Ingersoll Rand completed the acquisition of G & D Chillers, Inc. (G&D) and Advanced Gas Technologies Inc. (“AGT”). The acquisitions expanded the company’s air treatment portfolio. In the second quarter, acquisitions contributed 6.5% to IR’s total revenues.

Strong free cash flow generation supports Ingersoll Rand’s shareholder-friendly activities. In the first six months of 2025, the company’s free cash flow jumped 13.3% year over year to $433.1 million. In the same period, IR paid out dividends of $16.1 million and repurchased treasury stocks worth $510.2 million.

Near-Term Headwinds

Cost inflation is weighing on Ingersoll Rand’s operations. The company’s cost of sales increased 4.1% and 1.8% year over year in the first six months of 2025 and in 2024, respectively, due to the increasing cost of raw materials and component parts. Ingersoll Rand’s selling and administrative expenses surged 5.6% in 2024.

The trend continued in the first six months of 2025, with selling and administrative expenses increasing 6.3%. This drove up the selling and administrative expenses, as a percentage of revenues, by 50 basis points to 20%.

IR’s highly-leveraged balance sheet also remains concerning. Exiting second-quarter 2025, the company’s long-term debt was $4.78 billion, higher than $4.77 billion at the first quarter-end. Also, interest expenses in the second quarter were $62.7 million, up 23.4% year over year.

IR, which belongs to the Zacks Manufacturing - General Industrial industry, faces stiff competition from several peers including Flowserve Corporation FLS, Graco, Inc. GGG and IDEX Corporation IEX.

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