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Quote this valuation with its source: Fair value, Potential value and the price at analysis.
FAQ
IR — frequently asked questions
Is Ingersoll Rand Inc. overvalued?
In our latest published analysis dated 2026-10-05, IR looks meaningfully overvalued. The price recorded at analysis is 77,8 USD versus our fair value of 61,5 USD; the high endpoint is presented separately as potential value of 69,3 USD. That implies roughly 21.0% downside to fair value at that date.
Our latest published report, analyzed 2026-10-05, gives IR a fair value of 61,5 USD and a potential value of 69,3 USD. The conclusion is triangulated across multiple valuation models and weighted by reliability for Ingersoll Rand Inc.'s archetype; it is a dated research output, not a live price.
Should I buy IR now?
Our latest published rating for IR, analyzed 2026-10-05, is Sell. Ingersoll Rand Inc. looks meaningfully overvalued at the analysis-date price of 77,8 USD versus fair value of 61,5 USD; potential value is 69,3 USD. This is research for educational purposes, not personalized investment advice.
What are the biggest risks for IR?
The dedicated bear-case section in our report analyzed 2026-10-05 documents Ingersoll Rand Inc.'s material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.
What is IR's rating?
Our latest published rating for IR, analyzed 2026-10-05, is Sell, with a published moat assessment of 7.2/10 (Narrow). It reflects our fair value of 61,5 USD, the potential value of 69,3 USD, and the price recorded at analysis (77,8 USD).
Ingersoll Rand Inc. (NYSE: IR) trades at $77.78 as of October 5, 2026, representing a 26.6% premium to our Fair Value estimate of $61.46 (-21.0% implied return), which underpins our Sell recommendation as market pricing exceeds fundamental valuation despite strong free cash flow conversion of approximately 95%.3,5
Ingersoll Rand Inc. (IR) is subject to a Sell recommendation, as its market price of $77.78 as of October 5, 2026 trades at a 26.6% premium above our Fair Value of $61.46, yielding an implied return of -21.0%. The company trades at a forward P/E of 19.34x, well above cyclical machinery peers such as Cummins at 15.28x. This valuation leaves no against macro headwinds and rising funding costs across its $4,849.5 million debt burden, which carries a 6.24% pre-tax .
Operational performance exhibits clear regional divergence. While North America generated $3,189.9 million in FY2025 (41.7% of sales) with resilient short-to-medium cycle industrial activity, international markets face significant strain. In EMEA ($2,601.5 million or 34.0% of FY2025 revenue), Q2 2026 organic orders declined low double digits due to long-cycle project phasing in blowers and vacuums. Concurrently, China ($789.5 million in FY2025 revenue) experienced intense original equipment price competition, leading management to guide full-year ITS margins below FY2025 levels.5,7
The core business benefits from a Narrow economic moat supported by mission-critical flow equipment and sticky aftermarket parts and service revenues across Industrial Technologies & Services ($6,056.4 million in FY2025 sales). Ingersoll Rand maintains low capital expenditure intensity of 1.77% of revenue ($135.6 million in FY2025), enabling management to target approximately 95% free cash flow conversion and support programmatic bolt-on M&A that adds approximately 2.5% to annual top-line growth.5,6,7
Management updated FY2026 revenueguidance to 4.5%–6.5%, supported by consensus expectations of $8,115.1 million in FY2026 revenue and $3.92 in FY2027 diluted EPS. Furthermore, high industrial electricity costs continue to drive secular payback demand for energy-efficient compressor upgrades, building project backlog into 2027. Nevertheless, these operational virtues are fully discounted at current multiples; under a 9.08% WACC and terminal exit multiple of 18.5x, fair value of $61.46 offers an unfavorable risk profile, justifying a Sell rating.1,2,5
Massive Installed Base and Recurring Aftermarket Demand
Ingersoll Rand's Industrial Technologies & Services segment generated $6,056.4M in FY2025 (79.2% of consolidated revenue), where mission-critical compressed air installations generate sticky, high-margin aftermarket service and parts revenue that insulates cash flow across business cycles.7
Secular Upgrade Cycles Driven by High Electricity Rates
With compressed air accounting for significant manufacturing electricity consumption, rising power prices shorten customer payback periods on replacing older equipment with energy-efficient models, building 6- to 18-month project backlog into 2027.5
Disciplined Capital Intensity and 95% FCF Conversion
We assign Ingersoll Rand a Sell rating with a Fair Value of $61.46 per share, indicating -21.0% implied return from the analysis price of $77.78. At current trading levels, the market prices Ingersoll Rand at a 26.6% premium to intrinsic value and 19.34x forward earnings. While the company possesses high operational quality, a Narrow economic moat, and resilient US industrial exposure ($3,189.9M in FY2025 revenue), this premium leaves no room for execution error amidst European order contraction and China pricing headwinds.3,5,7
Présentation de l’entreprise
Ingersoll Rand Inc. (NYSE: IR) is a global provider of mission-critical flow creation, air compression, and industrial solutions. The company operates through two primary reporting segments: Industrial Technologies & Services (ITS) and Precision & Science Technologies (PST). In FY2025, ITS generated $6,056.4 million (79.2% of consolidated revenue of $7,650.9 million), providing air compression systems, blowers, and vacuum pumps supported by a sticky installed base driving recurring aftermarket parts and services.
Precision & Science Technologies generated $1,594.5 million in FY2025 revenue (20.8% of sales), specializing in highly engineered positive displacement pumps, liquid and gas flow management, and specialized medical and lab equipment. By geography, the United States is the primary market, generating $3,189.9 million in FY2025 (41.7% of total revenue), followed by EMEA at $2,601.5 million (34.0%), Asia Pacific at $1,247.4 million (16.3%, with China accounting for $789.5 million), and Other Americas at $612.1 million (8.0%).
§2 Cas baissierEN
A macro stress scenario where European order deferrals spill over into North America, domestic Chinese original equipment pricing pressure persists, and corporate costs exceed the guided $170M ceiling would compress consolidated operating margins toward 13.5% (down from 14.96% in FY2025). Under these conditions, free cash flow conversion would fall below the guided 95% target, while a 100 bps expansion in WACC from 9.08% toward 10.1% alongside terminal P/E de-rating to 15.0x would compress intrinsic equity value toward the low-end fair value estimate of $27.12.
In the Bear scenario, industrial capital project deferrals in Europe deepen and spill into North America, while persistent price competition in China original equipment erodes gross profitability. High operating leverage and corporate overhead stickiness compress consolidated operating margins, leading free cash flow conversion to fall below guided levels and depressing cash generation.
Comment cette thèse peut échouer
Severe European and International Industrial Capex Contraction
EMEA generated $2,601.5M (34.0% of FY2025 revenue), where organic orders fell low double digits in Q2 2026 due to project delays. Management guidance relies on 1% to 3% full-year organic growth. If EMEA order deferrals spread to North America ($3,189.9M in FY2025 revenue), organic growth falling below 1.0% collapses top-line compounding.5,7
FV impact
-4.8%
Revenue and EPS growth 5 points lower for five years
Signaux d'alerte précoce à surveiller
Les cinq évolutions qui affaibliraient notre thèse d’investissement.
01
EMEA Organic Order Growth
Signals that European blower and vacuum project delays are deepening into structural capex retrenchment rather than temporary phasing, impairing 34.0% of consolidated sales ($2,601.5M in FY2025).
Actuel :Down low double digits in Q2 2026
Alerte siNegative organic order growth for two consecutive quarters
Ingersoll Rand derives its narrow economic moat from high customer switching costs and an expansive global installed base across its core Industrial Technologies & Services (ITS) segment, which generated $6,056.4M or 79.2% of consolidated FY2025 revenue. Flow-control machinery, air compressors, and vacuum systems are mission-critical components embedded into customer manufacturing and chemical processing lines. Because the initial equipment purchase cost represents only a small fraction of the total lifetime electricity consumption and potential cost of facility downtime, industrial operators show strong reluctance to substitute unproven alternatives, locking in profitable parts, consumables, and maintenance service contracts throughout 10- to 20-year equipment lifecycles.
Global scale, specialized distribution networks, and the Ingersoll Rand Execution Excellence (IRX) operating system reinforce entry barriers by streamlining operational execution and localized product delivery. Core compressor demand in the United States ($3,189.9M in FY2025 revenue) remains resilient, insulated by deep commercial distribution partnerships and rapid field-service response capabilities. Furthermore, rising power prices shorten payback periods for replacing older, less efficient compressors, accelerating customer upgrade momentum.
However, the moat is bounded at Narrow rather than Wide due to the presence of substantial heavy capital equipment exposure where original equipment sales face cyclical tender competition. Particularly in China ($789.5M in FY2025 revenue), pricing pressure among original equipment manufacturers created measurable segment margin dilution in Q2 2026. Consequently, consolidated operating margin of 14.96% trails premium instrumentation peers such as Ametek at 26.18% and Parker-Hannifin at 23.46%.
Profit économique
Ingersoll Rand generates substantial economic profit through high aftermarket recurring revenues and asset-light operations (capex at 1.77% of FY2025 revenue of $7,650.9M). While unadjusted reported return on invested capital of 7.47% to 7.75% is constrained by accumulated goodwill from past business combinations, cash returns on tangible invested capital comfortably exceed the computed WACC of 9.08%, supported by guided ~95% free cash flow conversion.2,5,6
7.2/ 10
Narrow
Sources of advantage
01Customer Switching Costs — Mission-critical flow creation, compressor, and blower installations are integrated directly into continuous industrial manufacturing processes where equipment downtime carries catastrophic costs, creating high customer switching costs and recurring aftermarket demand across ITS ($6,056.4M in FY2025 revenue).Wide
02Installed Base Advantage — A vast global installed base of rotary screw compressors and vacuum pumps generates steady, non-cyclical aftermarket parts, service, and consumable revenue, with the United States geographic anchor generating $3,189.9M in FY2025 sales.Wide
Menaces connues pour l'avantage
Menace
Gravité
Calendrier
Atténuation
Intensified Price Competition in International Original Equipment Markets
medium
12 to 18 months
Management is localizing acquired specialized technologies into China under established brands to differentiate on total cost of ownership rather than competing purely on equipment price.5
The highlighted cell is Fair value when every assumption sits at its base level ($61.46). Each row and column shows what Fair value becomes when one assumption moves.
Free cash flow to the firm stays positive in the first projected year at $849.1M after modeled reinvestment of $115.8M, with terminal value at 74.4% of enterprise value. A sudden drop in free cash flow is not projected unless capital spending relative to revenue, reinvestment, or gross margin resets materially.
The Base scenario models steady industrial compounding supported by ITS installed base aftermarket recurring revenues and disciplined execution. Operating margins expand gradually as corporate costs normalize to ~$170M and back-half direct material productivity materializes. International project deferrals in Europe and OE margin drag in China are absorbed as 6- to 18-month project backlog converts into 2027 revenue.5,7
Even in a scenario where full-year results exceed the top end of guidance, the market valuation already prices in substantial earnings acceleration, leaving the fair value range below current trading levels.
Conforme
Maintain Sell; Maintain the established defensive portfolio posture; verify that unallocated corporate expenses remain on track for the guided annual threshold and monitor European order intake.
Déclencheur: Full-year revenue growth within 4.5% to 6.5% and adjusted EPS of $3.45 to $3.575
Results tracking within guided corridors confirm baseline compounder performance but do not bridge the valuation gap to current market quotes.
Manqué
Exit the position; Accelerate capital preservation measures; review exposure for complete position reduction and re-examine whether long-cycle backlog cancellations are expanding.
An execution miss driven by worsening project deferrals in Europe or continued margin degradation in China would validate the bear thesis and accelerate valuation multiple compression.
Qualité des résultats
Earnings quality is structurally sound, evidenced by guided free cash flow conversion of approximately 95% and modest stock-based compensation of $53.0M in FY2025 (0.69% of revenue), which remains below the industrial benchmark of 0.90%. However, the wide variance between GAAP diluted EPS of $1.45 ($581.4M net income) and adjusted EPSguidance of $3.45 to $3.57 reflects heavy non-cash acquisition amortization, requiring investors to anchor on cash generation rather than adjusted accounting metrics.5,6
Dynamique des estimations
Post-earnings estimate momentum remained flat across consensus revisions following the Q2 earnings event, with FY2026 EPS consensus holding at $3.50 before drifting to $3.55, and FY2027 EPS consensus holding at $3.85 before drifting to $3.92. Revenue revision cohorts similarly remained flat around the release before reflecting the updated 4.5% to 6.5% top-line guidance.1,5
Métriques à surveiller avant publication
01
Métrique:
ITS Organic Revenue Growth and Americas Demand Stability
ActuelGuided company-wide organic growth is 1% to 3% for FY2026.
Pourquoi c'est important
ITS accounts for 79.2% of consolidated sales ($6,056.4M in FY2025); sustaining organic growth confirms installed base stability.7
Ingersoll Rand exhibits consistent cash generation across industrial cycles. Operating cash flow reached $860.3M in FY2022 following free cash flow of $551.4M in FY2021. Capital expenditure requirements remain low, with FY2025 capex of $135.6M representing 1.77% of revenue, and normalized maintenance capex estimated at $108.5M (80% of total capex). With guided FY2026 free cash flow conversion of approximately 95%, free cash flow to firm is projected to reach $849.1M in FY2026 and compound toward $1,060.3M by FY2030.3,5,6,
Headline ROIC appears muted due to accumulated goodwill from historical acquisitions, but underlying cash return on tangible capital remains robust. As operating margin expands from 14.96% in FY2025 toward 16.0% in FY2027 and 17.0% in FY2030, economic value creation will steadily expand.
Unadjusted reported ROIC of 7.47% to 7.75% sits below the computed WACC of 9.08% due to $8.48B in merger goodwill. However, cash return on tangible capital exceeds cost of capital, supported by low capex intensity (1.77% of revenue) and ~95% guided free cash flow conversion.
Dernier chiffre d’affaires7,7 Md $USTCAC du chiffre d’affaires +16,5 %
Marge opérationnelle15,0 %10 périodes fiscales
Dernier flux de trésorerie disponible1,2 Md $USFY2025
Dette nette3,6 Md $USFY2025
Décomposition du compte de résultatComment la taille de l’activité se traduit en bénéfice publié.30 juin 2026
StockMarketAgent.AI
Chiffre d'affaires2 Md $USCoût des ventes−1,2 Md $USMarge brute862,6 M $USCharges d’exploitation−482,3 M $USRésultat d'exploitation380,3 M $USÉléments hors exploitation et impôts−123,5 M $USRésultat net256,8 M $US
Données de l’historique financier
Chiffre d'affaires
2 048 800 000 $US
Coût des ventes
1 186 200 000 $US
Marge brute
862 600 000 $US
Charges d’exploitation
482 300 000 $US
Résultat d'exploitation
380 300 000 $US
Éléments hors exploitation et impôts
-123 500 000 $US
Résultat net
256 800 000 $US
Aperçu du bilanComment les actifs publiés sont détenus et financés pour la période sélectionnée.
StockMarketAgent.AI
Composition des actifsFinancé par
Total de l’actif18,3 Md $USTrésorerie1,2 Md $USActifs courants4,2 Md $USTotal du passif8,1 Md $USPassifs courants2,1 Md $USCapitaux propres10,2 Md $US
Données de ventilation du bilan
Total de l’actif
18 297 200 000 $US
Trésorerie
1 248 800 000 $US
Actifs courants
4 248 000 000 $US
Total du passif
8 143 200 000 $US
Passifs courants
2 066 300 000 $US
Capitaux propres
10 154 000 000 $US
Passerelle des flux de trésorerieComment le flux de trésorerie d’exploitation est devenu du flux de trésorerie disponible en FY2025.
StockMarketAgent.AI
Rapprochement des flux d’exploitation
Résultat net581,4 M $USDotations aux amortissements+505,8 M $USRémunération en actions+53 M $USAutres ajustements opérationnels+215,5 M $USFlux de trésorerie d'exploitation1,4 Md $US
Rapprochement de la trésorerie d’ouverture à la clôture
Trésorerie d’ouverture1,5 Md $USFlux de trésorerie d'exploitation+1,4 Md $USFlux d’investissement−660,6 M $USFlux de financement−1,1 Md $USEffet de change+66,3 M $USTrésorerie de clôture1,2 Md $US
1,4 Md $US − 135,6 M $USFlux de trésorerie disponible 1,2 Md $US
Données de la passerelle des flux de trésorerie
Résultat net
581 400 000 $US
Entrées d’exploitation
1 355 700 000 $US
Dotations aux amortissements
505 800 000 $US
Rémunération en actions
53 000 000 $US
Autres ajustements opérationnels
215 500 000 $US
Flux de trésorerie d'exploitation
1 355 700 000 $US
Trésorerie disponible
2 963 200 000 $US
Trésorerie d’ouverture
1 541 200 000 $US
Effet de change
66 300 000 $US
Sorties d’investissement
660 600 000 $US
Capex
135 600 000 $US
Autres activités d’investissement
525 000 000 $US
Sorties de financement
1 053 800 000 $US
Rachats d’actions
1 018 000 000 $US
Dividendes versés
31 800 000 $US
Autres activités de financement
4 000 000 $US
Trésorerie de clôture
1 248 800 000 $US
Flux d’investissement
-660 600 000 $US
Flux de financement
-1 053 800 000 $US
Chiffre d’affaires par secteur opérationnelPart du chiffre d’affaires total pour 2025-12-31.
7,7 Md $USChiffre d’affaires total
Chiffre d’affaires par secteur opérationnelPart
Industrial Technologies And Services6,1 Md $US79,2 %+4,1 % sur un an
Precision And Science Technologies1,6 Md $US20,8 %+12,5 % sur un an
Source: SEC EDGAR · Déposé le 2026-02-17 · SEC EDGAR
Données de répartition du chiffre d’affaires: Chiffre d’affaires par secteur opérationnel
Chiffre d’affaires par secteur opérationnel
Chiffre d'affaires
Part
sur un an
Industrial Technologies And Services
6,1 Md $US
79,2 %
4,1 %
Precision And Science Technologies
1,6 Md $US
20,8 %
12,5 %
Chiffre d’affaires et résultatsComment la taille de l’activité se traduit en bénéfice publié.
Trésorerie et detteLiquidités disponibles face à l’endettement total.
Génération de trésorerieFlux de trésorerie d’exploitation comparé au flux de trésorerie disponible.
RentabilitéÉvolution des marges brute, opérationnelle et nette.
Données financières ponctuelles utilisées dans l’analyse du 2026-10-05.
Ingersoll Rand Inc. (IR) trades at 19.3x forward earnings against a peer median of 23.5x. Its EV/EBITDA of 16.5x compares with a peer median of 19.9x. The comparison uses 4 peers: Cummins Inc., Emerson Electric Co., AMETEK Inc. and Parker-Hannifin Corporation, as of 2026-10-03 to 2026-10-04.
§10 Secteur et cycleEN
Phase du cycle
Expansion
Industry capex-to-revenue stands at 4.1% and industry capex-to-depreciation is 0.68, confirming disciplined reinvestment below depreciation rates across industrial machinery peers. Ingersoll Rand maintains even leaner operations, posting FY2025 capex of $135.6M or 1.77% of sales. Because specific sector capacity, supply lead-time, and customer-concentration evidence is unavailable in the data packet, this cycle view is demand-led and evidence-limited.6
Cycle haussier
An accelerating replacement upcycle where elevated industrial electricity costs shorten customer payback periods, converting 2027 project backlogs into double-digit organic growth and expanding operating margins toward 17.5%.
Cycle baissier
A cyclical downturn where long-cycle project deferrals in Europe ($2,601.5M FY2025 sales) spread into North America, compounding original equipment price competition in China and dragging organic growth below 1.0%.
Tendances séculaires
Tendance
Impact
Note
Industrial Energy Efficiency and Decarbonization Mandates
positive
Escalating facility electricity costs shorten customer payback periods on replacing older compressors, driving secular upgrade demand as engineering and EPC constraints ease, building backlog into 2027.
North American Manufacturing Reshoring and Automation
positive
Capital investment in domestic production and automation infrastructure anchors long-term volume in the United States, which generated $3,189.9M in FY2025 revenue.
Positionnement
Ingersoll Rand holds premier market share in flow creation and compressors via ITS ($6,056.4M in FY2025 sales) and specialized fluid handling via PST ($1,594.5M). Consolidated operating margin of 14.96% in FY2025 is in line with the industry benchmark of 16.1% and ahead of Cummins (11.90%), though trailing specialized peers like Ametek (26.18%) and Parker-Hannifin (23.46%).4,6,7
§11 Gestion de positionEN
Taille de position
A 0.0% weight is recommended in alignment with the sell rating. At current trading levels, Ingersoll Rand trades at a 26.6% premium to the fair value midpoint of $61.46, leaving an unfavorable risk-reward skew.
Risque
Given the sell rating and elevated valuation (trading at $77.78 vs $61.46 fair value midpoint), risk management mandates total avoidance of new long exposure and prompt harvesting of existing gains. Portfolios holding legacy positions should utilize market liquidity to execute an orderly exit, eliminating exposure to European project deferrals, China original equipment margin pressure, and potential valuation multiple de-rating toward cyclical machinery averages.
Shares trade at a 26.6% premium to the fair value midpoint ($61.46) with forward P/E of 19.34x, offering negative implied return.
Fair Value Midpoint (~$61.46)
Re-evaluate Fundamental Stabilization
At intrinsic fair value, shares would price in baseline cash flows, warranting re-assessment of European order stabilization and China margin performance.
Ingersoll Rand's Fair Value of $61.46 per share sits 21.0% below the current trading price of $77.78. Value investors should avoid the stock as it offers negative risk-adjusted returns and a 26.6% valuation premium under a 9.08% WACC.2,3
Growth at a Reasonable Price (GARP) Investor
Avoid
Although the company exhibits high-quality compounding metrics, including ~95% free cash flow conversion and disciplined capex at 1.77% of revenue, full-year organic growth of 1% to 3% does not justify paying 19.34x forward earnings.3,5,6
Cyclical & Momentum Investor
Avoid
Negative organic order growth in EMEA blowers and vacuums and ongoing original equipment margin dilution in China present earnings vulnerability over the coming 6 to 12 months, limiting multiple expansion potential.5
§14 Recommandation finaleEN
Action
Vendre
We recommend a Sell rating on Ingersoll Rand Inc. (IR). At $77.78 per share as of October 5, 2026, the stock trades at a 26.6% premium to our intrinsic Fair Value of $61.46 (-21.0% implied return). While Ingersoll Rand is an operationally sound business with a Narrow moat and guided 95% free cash flow conversion, the market is pricing in aggressive terminal compounding while ignoring real European project delays and China original equipment margin dilution.3,5
At 19.34x forward earnings and a cost of capital of 9.08%, risk is heavily skewed to the downside. Investors should use current trading strength to trim or exit positions, reallocating capital toward industrial peers trading at discounts to intrinsic value.
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Sources
The records this analysis drew on, as they stood when it was run.
Financial statementsData as of 2021-12-31 · Published 2026-10-05 · cited for 1 figureCited in Historique financier
Not every cited input appears here: internal calculations and intermediate model outputs have no external record, and some citations could not be matched to one.
China Original Equipment Price War and Corporate Cost Stickiness
China revenue of $789.5M created significant margin pressure in Q2 2026, leading management to project full-year ITS margins below FY2025. Compounded by sticky corporate costs ($49M in Q2 2026), intensified price competition drags consolidated operating margin from FY2025's 14.96% below 13.5%.5,6,7
FV impact
0%
Operating margin 3 points lower throughout
Trigger
Within 18 months
Multiple De-rating to Cyclical Machinery Peer Valuations
The base valuation assumes a terminal P/E of 18.5x relative to current forward P/E of 19.34x. Cyclical machinery peer Cummins trades at 15.28x forward P/E. If Ingersoll Rand's organic growth stalls and the market re-evaluates IR as a cyclical machinery manufacturer rather than a premium automation peer, forward valuation multiple de-rating toward 15.0x drives substantial capital loss.3,4
FV impact
-5.7%
Terminal multiple 20% lower
Trigger
Within 12 months
Cost of Capital Expansion Under Macro Tightening and Debt Refinancing
Ingersoll Rand carries $4,849.5M in total debt with pre-tax cost of debt at 6.24% and current liabilities of $2,066.3M. Base computed WACC is 9.0757%. If debt refinancing spreads widen and equity beta expands above 1.095, WACC increasing by over 100 bps severely penalizes long-duration enterprise cash flows.2,3,6
FV impact
-5.3%
Cost of capital 1 point higher
Trigger
Within 12 months
Indicates that original equipment price competition in China and corporate overhead inflation cannot be offset by commercial pricing or direct material productivity.
Falsifies the core thesis that ITS installed base recurring aftermarket demand insulates top-line compounding from broader industrial economic slowdowns.
Actuel :Guided full-year organic growth of 1% to 3% for FY2026
Refinancing debt obligations ($4,849.5M total debt) under elevated interest rates alongside equity beta expansion above 1.095 increases enterprise capital costs and contracts fair value.
Actuel :9.08%
Alerte siWeighted average cost of capital exceeding 10.1%
03
Intangible Assets and Specialized Engineering — Proprietary energy-efficient compressor designs and variable-speed systems shorten customer payback periods in high-electricity-cost environments, securing multi-year project backlogs extending into 2027.
Moderate
Macro Capex Deferrals and Project Phasing Elongation in Europe
medium
6 to 12 months
Core compressor replacement demand in EMEA continues to grow low single digits organically, supported by high electricity rates that sustain ROI for energy efficiency upgrades.5
Discounted forecast-period cash flows (9,30 $US) plus discounted terminal value (27,07 $US) minus signed per current share (9,28 $US) equals the 27,09 $US lens value shown above. Negative net debt is , so subtracting it raises value.
In the Bull scenario, rising industrial electricity costs dramatically accelerate compressor upgrade cycles across North America and Europe, driving double-digit organic order growth and swift backlog conversion through 2027. PST segment margins expand toward the mid-30s while direct material productivity and mix improvements push consolidated operating margins toward peer-leading levels, accelerating free cash flow compounding.5
Down low double digits organically in Q2 2026 due to project phasing in blowers and vacuums.
Pourquoi c'est important
EMEA generated 34.0% of FY2025 sales ($2,601.5M); order stabilization is necessary to prove project delays are timing-related.7
03
Métrique:
China Original Equipment Pricing and Segment Margin Dilution
ActuelManagement expects full-year ITS margins to remain slightly below FY2025.
Pourquoi c'est important
China revenue ($789.5M in FY2025) drove ITS margin pressure in Q2 2026; stabilization is required for full-year margin targets.7
04
Métrique:
Unallocated Corporate Expense Normalization
ActuelGuided to approximately $170M for full year 2026.
Pourquoi c'est important
Corporate costs surged to $49M in Q2 2026; quarterly run-rates must normalize to achieve the guided $170M annual cap.5
Capital allocation emphasizes programmatic bolt-on M&A and share repurchases over cash dividends. In FY2025, stock-based compensation of $53.0M was offset by repurchases. The dividend payout is low at $0.08 per share annually. Total debt stood at $4,849.5M at FY2025 ($4,906.7M as of 2026-10-05), resulting in a debt weight of 13.99% against market equity of $30,178.6M (86.01% equity weight). Management continues deploying free cash flow into acquisitions that contribute approximately 2.5% to top-line growth.
Asset-Light Operations Underpin High Free Cash Flow Conversion
The business model converts the vast majority of operating profits directly into free cash flow ($849.1M projected for FY2026), providing ample internally generated liquidity for programmatic M&A without requiring equity issuance.
Geographic Divergence Shows North American Core Offsetting International Drag
United States sales generated $3,189.9M in FY2025 (41.7% of total), whereas EMEA orders dropped low double digits in Q2 2026 and China ($789.5M FY2025 sales) created margin dilution.
Consolidated growth relies heavily on steady North American industrial demand to carry performance while international project deferrals resolve into 2027.
Corporate Overhead Normalization Is Critical for Back-Half Margin Delivery
Unallocated corporate expenses increased to $49M in Q2 2026 compared to $34.6M in Q2 2025, with management guiding full-year corporate overhead to approximately $170M.
Achieving full-year margin targets requires corporate overhead to normalize to ~$35M-$40M per quarter in 2H 2026 alongside expected direct material productivity benefits.
AMETEK Inc.AME
Cours / juste valeur
Juste valeur171,8 $USReport-date price251,93 $US
Date d’évaluation
Avantage concurrentielWide
Score d’investissement66 / 100
Parker-Hannifin CorporationPH
Cours / juste valeur
Juste valeur675,45 $USReport-date price958,22 $US
Date d’évaluation
Avantage concurrentielWide
Score d’investissement67 / 100
Marge
IR
Ingersoll Rand Inc.
$30.2B
19.3x
3.8x
16.5x
9.5%
—
CMI
Cummins Inc.
$72.9B
15.3x
2.1x
15.6x
21.1%
11.9%
EMR
Emerson Electric Co.
$90.5B
22.2x
4.9x
16.8x
12.8%
26.9%
AME
AMETEK Inc.
$57.7B
26.3x
7.3x
23.8x
14.6%
26.2%
PH
Parker-Hannifin Corporation
$122.7B
24.7x
5.7x
23.1x
25.1%
23.5%
Chinese Domestic Equipment Pricing Competition
negative
Intensifying domestic original equipment competition in China ($789.5M in FY2025 revenue) drives gross margindilution across standard machinery lines.
