Flowserve Exhibits Strong Prospects Despite Ongoing Headwinds

Flowserve Corporation FLS is gaining from solid momentum across its segments. Strength in the aftermarket business, driven by a strong demand for products and services in North America, the Middle East and Africa, is a prime catalyst for the Flowserve Pumps Division segment’s growth. An increase in bookings across general industries and power end markets also bodes well for the segment. Solid momentum across original equipment and aftermarket businesses, backed by an increase in demand for products and services in North America, Latin America, Asia Pacific and Europe, is supporting the Flow Control Division segment. Driven by strength across its businesses in 2025, the company expects total revenues to increase in the range of 4-5% from the year-ago level.

FLS solidified its product portfolio and leveraged business opportunities through asset additions. In October 2024, it completed the acquisition of MOGAS Industries, which augmented the company’s existing valve and automation product portfolio and accelerated its 3D growth strategy by significantly boosting its direct mining and mineral extraction exposure. The buyout has been integrated into Flowserve’s Flow Control Division segment and improved its aftermarket potential and generated revenue growth synergies. In July 2024, the company acquired the intellectual property and in-process R&D related to cryogenic liquefied natural gas (LNG) submerged pump technology, systems and packaging from NexGen Cryogenic Solutions Inc. NexGen’s pump and cold energy recovery turbine technology for the liquefaction, shipping and regasification markets expanded FLS’ LNG product portfolio and complemented its existing pumps, valves and mechanical seals offering. NexGen’s technology has been added to Flowserve’s Pumps Division segment.

The company’s commitment to rewarding shareholders through dividends and share buybacks is encouraging. In the first nine months of 2025, it used $82.7 million to distribute dividends and bought back shares worth $197.9 million. In the first quarter of 2024, Flowserve hiked its quarterly dividend by approximately 5% to 21 cents per share.

Price Performance of FLS

In the past six months, this Zacks Rank #3 (Hold) company’s shares have gained 38.7% compared with the industry’s 7.1% growth.

However, high costs pose a threat to FLS’ bottom line.  In the first nine months of 2025, the cost of sales increased 1.5% year over year to $2.35 billion due to higher input costs. The metric, as a percentage of net sales, was 67%. Selling, general and administrative expenses increased 12.1% in the same period.

Flowserve has a significant presence in the international markets. As a result, its financial performance is subject to various risks like the foreign currency exchange rate, interest rate fluctuations and hyperinflation in some foreign countries. For instance, currency headwinds had an adverse impact of $36.8 million on net earnings in the first nine months of 2025. The increased value of the U.S. dollar relative to the local currencies of the foreign markets may affect the company’s top line in the quarters ahead.

Stocks to Consider

Some better-ranked companies are discussed below:

DNOW Inc. DNOW presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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In the past 30 days, the consensus estimate for Watts Water’s 2025 earnings has increased 0.3%.

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