IDEX Stock Exhibits Strong Prospects Despite Persisting Headwinds

IDEX Corporation IEX is gaining from the strong performance of the Fluid & Metering Technologies (FMT) & Health & Science Technologies (HST) segments. An increase in demand for products across the municipal water business has been proving beneficial for the FMT segment. Higher volume in the industrial water business bodes well for the segment. Solid momentum in the pharma, life science, semiconductor consumables and data center businesses is aiding the HST segment.  Also, the targeted growth initiatives in the space business and strength in defense markets bode well for the segment.

IDEX is carrying out successive acquisitions to expand its operations. In the fourth quarter of 2025, acquisitions had a positive impact on IEX’s sales of 1%. In July 2025, the company acquired Micro-LAM, Inc. (Micro-LAM), which is expected to expand IDEX’s optics technologies offerings. The acquired company has been incorporated within the HST segment. In September 2024, IDEX acquired Mott Corp. and its subsidiaries (Mott) for a cash consideration of $1 billion. This acquisition expanded the company’s applied materials science technology capabilities across high-value end markets. The inclusion of Mott’s technical and application expertise will bolster its micro-precision technology offerings. It will enable the company to penetrate and diversify its offerings in key markets such as semiconductor fabrication, medical technologies and water purification.

The company believes in rewarding its shareholders handsomely through dividend payments. In 2025, IDEX’s dividend payments totaled $212.6 million (up 3.6% year over year). The current quarterly dividend rate is 71 cents per share (a hike of 2.9% was announced in May 2025). In September 2025, the company’s board of directors increased the share repurchase authorization to $1 billion. Exiting the fourth quarter of 2025, IDEX had a remaining balance of $926.7 million under its stock repurchase program.

IEX’s Zacks Rank

In the past three months, this Zacks Rank #3 (Hold) company’s shares gained 18.6% compared with the industry’s 12.7% growth.

However, IEX has been witnessing weakness in the Fire & Safety/Diversified Products (FSDP) segment. Softness in the dispensing business due to unfavorable timing of dispensing projects in emerging markets and slower equipment replenishment is concerning for the segment. Also, a decrease in demand for fire and rescue tools is acting as a headwind for the segment’s performance. 

The company 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. The increased value of the U.S. dollar relative to the local currencies of the foreign markets is likely to affect the top line in the quarters ahead.

Stocks to Consider

Some better-ranked companies are discussed below.

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Flowserve’s earnings surpassed the consensus estimate in each of the trailing four quarters. The average earnings surprise was 17.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2026 earnings has increased 4.6%.

Nordson Corporation NDSN currently carries a Zacks Rank #2 (Buy). Nordson’s earnings topped the consensus estimate in each of the trailing four quarters. The average earnings surprise was 2.5%.

In the past 60 days, the Zacks Consensus Estimate for Nordson’s fiscal 2026 earnings has increased 1.4%.

Parker-Hannifin Corporation PH currently carries a Zacks Rank of 2. Parker-Hannifin’s earnings topped the consensus estimate in each of the trailing four quarters. The average earnings surprise was 6.8%.

In the past 60 days, the Zacks Consensus Estimate for Parker-Hannifin’s fiscal 2026 earnings has increased 2.3%.

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This article originally published on Zacks Investment Research (zacks.com).

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