A month has gone by since the last earnings report for Idex (IEX). Shares have added about 2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Idex due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for IDEX Corporation before we dive into how investors and analysts have reacted as of late.
IDEX Q3 Earnings Surpass Estimates, Sales Increase Year Over Year
IDEX’s third-quarter 2025 adjusted earnings of $2.03 per share surpassed the Zacks Consensus Estimate of $1.93. The bottom line increased 7% on a year-over-year basis. Management projected adjusted earnings to be in the band of $1.90-$1.95 per share in the quarter.
Revenue Details
IDEX’s net sales of $879 million beat the Zacks Consensus Estimate of $858.3 million. The top line increased 10% year over year. Organic sales increased 5% year over year. While acquisitions/divestitures had a positive impact on sales of 4%, foreign currency translation had a positive impact of 1% on sales.
It reports net sales under three business segments, the results of which are discussed below:
Net sales from the Fluid & Metering Technologies segment totaled $317.1 million, up 5% year over year. Our estimate for segmental net sales was $297.3 million. Organic sales increased 4% year over year. Foreign currency translation had a positive impact of 1% on sales.
Net sales from the Health & Science Technologies segment totaled $381.0 million, up 22% year over year. Our estimate for segmental net sales was $363.9 million. Organic sales increased 10% year over year. Acquisitions/divestitures and foreign currency translation had a positive impact of 11% and 1%, respectively, on sales.
Net sales from the Fire & Safety/Diversified Products segment totaled $181.9 million, which decreased 3% year over year. Our estimate for segmental net sales was $195.1 million. Organic sales decreased 5% on a year-over-year basis, while foreign currency translation had a favorable impact of 2% on sales.
IDEX’s Margin Profile
IDEX’s cost of sales increased 9.9% year over year to $488.1 million. The adjusted gross profit was $391.2 million, up 9.9% year over year. The adjusted gross margin was 44.5% compared with 44.6% in the year-ago quarter.
Selling, general and administrative expenses increased 11.9% year over year to $204.7 million. Adjusted EBITDA was $239.8 million, up 11.9% from the year-ago quarter figure. The adjusted EBITDA margin increased 40 bps year over year to 27.3%.
The operating income was $185.8 million, up 10.6% year over year. The operating margin was 21.1%, up 10 bps year over year. Interest expenses (net) increased 60.2% year over year to $16.5 million.
Balance Sheet and Cash Flow of IDEX
While exiting the third quarter, IDEX’s cash and cash equivalents were $593.8 million compared with $620.8 million at the end of fourth-quarter 2024. Long-term borrowings (net) were $1.90 billion compared with $1.86 billion at the end of fourth-quarter 2024.
In the first nine months of 2025, IDEX generated net cash of $470.9 million from operating activities, down 5% from the year-ago period. Capital expenditures were $43.9 million compared with $49.6 million in the first nine months of 2024. In the same period, free cash flow was $427.0 million, down 4.2% year over year.
IDEX paid out dividends totaling $159.4 million in the first nine months of 2025, up 4.2% year over year.
IDEX’s Outlook
For 2025, the company anticipates adjusted earnings to be in the range of $7.86 - $7.91 per share compared with $7.85 - $7.95 expected earlier. It reported adjusted earnings of $7.89 per share in 2024. On a GAAP basis, earnings are predicted to be in the band of $6.35-$6.40 per share.
Organic sales are predicted to increase approximately 1%.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates review.
VGM Scores
At this time, Idex has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock was allocated a score of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Idex has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Idex belongs to the Zacks Manufacturing - General Industrial industry. Another stock from the same industry, Graco Inc. (GGG), has gained 2.1% over the past month. More than a month has passed since the company reported results for the quarter ended September 2025.
Graco reported revenues of $543.36 million in the last reported quarter, representing a year-over-year change of +4.7%. EPS of $0.73 for the same period compares with $0.71 a year ago.
Graco is expected to post earnings of $0.77 per share for the current quarter, representing a year-over-year change of +20.3%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.3%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Graco. Also, the stock has a VGM Score of D.
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IDEX Corporation (IEX): Free Stock Analysis Report Graco Inc. (GGG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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