Flowserve Stock Could See Higher Levels Led By Margin Expansion

SectorFinancial Markets
CountryMiddle east

BRAZIL - 2020/06/08: In this photo illustration the Flowserve Corporation logo seen displayed on a ... [+] smartphone. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images) SOPA Images/LightRocket via Getty Images We believe that Flowserve Corporation stock (NYSE: FLS), a manufacturer of pumps and valves, may be a good opportunity at the present time. FLS stock trades near $33 currently and it is, in fact, down 36% so far this year (from $51 at the beginning of 2020).

It traded at $46 in February 2020 – just before the coronavirus pandemic hit the world – and is currently 28% below that level as well. FLS stock has rallied over 68% since its March lows of $19, compared to the S&P 500 which gained about 60%. The stock has slightly outperformed the market because of earnings beat both in Q2 and Q3 led by better than estimated demand for its pumps. The company is sitting on a backlog of $2 billion, while it is ahead of its $100 million cost reduction program, which will aid the margins over the coming quarters, driving the stock higher from here, in our view. Our conclusion is based ...read more...