Wall Street expects a year-over-year decline in earnings on higher revenues when Ingersoll Rand (IR) reports results for the quarter ended December 2024. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on February 1 ...

Acquisition extends company’s capabilities in wastewater treatment, a key high-growth, sustainable end marketEnables Ingersoll Rand to provide more comprehensive wastewater treatment solutions, allowing for greater energy efficiency and increased productivity for customersCreates opportunities to accelerate topline growth through access to municipal marketsAttractive purchase multiple of approximately 10x 2024E Adjusted EBITDA DAVIDSON, N.C., Feb. 03, 2025 (GLOBE NEWSWIRE) -- Ingersoll Rand Inc., (NYSE: IR) ...

DAVIDSON, N.C., Jan. 17, 2025 (GLOBE NEWSWIRE) -- Ingersoll Rand Inc. (NYSE: IR), a global provider of mission-critical flow creation and life science and industrial solutions, will issue its fourth quarter 2024 earnings release after the market closes on Thursday, February 13, 2025. Ingersoll Rand will also host a live earnings conference call to discuss the fourth quarter results on Friday, February 14, 2025, at 8 a.m. Eastern Standard Time. To participate in the call, please dial +1-888-330-3073, domesti ...

Forex Exposure and International Presence - Ingersoll Rand has significant exposure to regions outside the United States, making it vulnerable to political and economic disruptions that can directly affect profits [1] - The company faces headwinds from unfavorable foreign currency movements due to its extensive international presence [1][2] Operational Performance and Stock Performance - Ingersoll Rand's recent operational performance has failed to impress investors due to rising costs and high debt levels [2] - The company's stock has declined 0.6% in the past six months, underperforming the industry's 7.4% growth [3] Rising Costs and Financial Impact - Cost inflation has significantly impacted Ingersoll Rand's operations, with the cost of sales increasing 11.2% year over year in 2023 [5] - Selling and administrative expenses surged 16.1% in 2023 and increased 7.5% in the first nine months of 2024 [5] - Selling and administrative expenses as a percentage of revenues rose by 40 basis points to 19% [6] - The company expects to incur corporate costs of $170 million in 2024, driven by investments in demand generation, digital, and IT-related areas [6] High Debt Levels and Financial Obligations - Ingersoll Rand's long-term debt increased to $4.8 billion at the end of Q3 2024, up from $2.7 billion at the end of 2023 [8] - Interest expenses in the first nine months of 2024 were $151.4 million, up 27% year over year [8] Industry Comparison and Alternative Stocks - Graham Corporation (GHM) is a better-ranked company in the same industry, with a Zacks Rank 1 (Strong Buy) and a trailing four-quarter average earnings surprise of 101.9% [7] - Gates Industrial Corporation plc (GTES) carries a Zacks Rank 2 (Buy) and has a trailing four-quarter average earnings surprise of 11.8% [9] - Generac Holdings Inc. (GNRC) also carries a Zacks Rank of 2, with a trailing four-quarter average earnings surprise of 10.8% [9]

Business Performance and Growth - Ingersoll Rand Inc (IR) is experiencing higher orders for industrial vacuums and blowers, along with stable compressor orders, driving growth in the Industrial Technologies & Services segment [1] - The Precision and Science Technologies segment benefits from growth in short-cycle orders and strong book-and-ship orders [1] - Management expects 2024 revenues to increase 5-7% year-over-year, with adjusted earnings forecasted at $3 28-$3 34 per share compared to $2 96 in 2023 [2] Acquisitions and Strategic Expansion - IR completed the acquisition of Air Power Systems Co (APSCO), Blutek s r l (Blutek), and UT Pumps & Systems Private Limited (UT Pumps) in October 2024 [3] - The APSCO acquisition strengthens IR's position in dry and liquid bulk markets with energy-efficient solutions [3] - The Blutek acquisition enhances competitiveness in high-specification projects, particularly in biogas and carbon capture markets, while UT Pumps adds new pump technology to IR's portfolio [4] - Acquisitions contributed 8 9% to total revenues in Q3 2024 [4] Shareholder Returns and Financial Management - IR paid $24 2 million in dividends and repurchased shares worth $198 2 million in the first nine months of 2024 [5] - The board approved an additional $1 billion increase to the share repurchase authorization in April 2024 [5] Cost and Debt Concerns - IR faces escalating costs, with cost of sales increasing 11 2% year-over-year in 2023 and selling and administrative expenses rising 16 1% [7] - Selling and administrative expenses increased 7 5% in the first nine months of 2024 [7] - Long-term debt rose to $4 8 billion by the end of Q3 2024, up from $2 7 billion at the end of 2023 [8] - Interest expenses increased 27% year-over-year to $151 4 million in the first nine months of 2024 [8] Stock Performance - IR's shares rose 20 5% in the past three months, outperforming the industry's 15 7% growth [7]

Company Performance - Ingersoll Rand (IR) has shown a year-to-date performance increase of approximately 26.3%, significantly outperforming the average gain of 11.7% in the Industrial Products sector [4] - The Zacks Consensus Estimate for Ingersoll Rand's full-year earnings has risen by 1.1% over the past quarter, indicating improved analyst sentiment and earnings outlook [4] - Ingersoll Rand holds a Zacks Rank of 2 (Buy), suggesting it has favorable characteristics for potential outperformance in the market [3] Industry Context - Ingersoll Rand is part of the Manufacturing - General Industrial industry, which consists of 42 individual stocks and currently ranks 148 in the Zacks Industry Rank [6] - The Manufacturing - General Industrial industry has experienced an average gain of 12.9% year-to-date, indicating that Ingersoll Rand is performing better than its industry peers [6] - Another company in the Industrial Products sector, Kadant (KAI), has also outperformed the sector with a year-to-date return of 28.3% and holds a Zacks Rank of 2 (Buy) [5]

Financial Performance - Net income attributable to Ingersoll Rand Inc. for the three months ended September 30, 2023, was $221.6 million, compared to $208.3 million for the same period in 2022, representing an increase of 6.3%[12] - Comprehensive income attributable to Ingersoll Rand Inc. for the nine months ended September 30, 2023, was $634.3 million, up from $459.0 million in the prior year, reflecting a growth of 38.2%[12] - Total revenue for the period ended September 30, 2024, was $1,861.0 million, an increase from $1,738.9 million in the same period of 2023, representing a growth of 7.0%[140] - Net income for the three-month period ended September 30, 2024, was $223.4 million, compared to $209.6 million for the same period in 2023, marking an increase of 6.0%[160] - Adjusted Net Income for the three-month period ended September 30, 2024, was $344.7 million, compared to $316.0 million for the same period in 2023[186] - Total revenue for the nine months ended September 30, 2024, was $5,336.4 million, an increase from $5,054.7 million in the same period of 2023, representing a growth of 5.6%[142] Comprehensive Income and Other Adjustments - Total other comprehensive income for the three months ended September 30, 2023, was $138.0 million, compared to a loss of $78.4 million in the same period last year[12] - Other comprehensive income for the nine months ended September 30, 2024, was $138.0 million, compared to a loss of $78.8 million for the same period in 2023[97] - The balance of accumulated other comprehensive loss as of September 30, 2024, was $(202.1) million, down from $(341.6) million as of September 30, 2023[99] Assets and Liabilities - Total assets increased to $18,206.2 million as of September 30, 2024, up from $15,563.5 million at December 31, 2023, representing a growth of 16.4%[16] - Total liabilities grew to $7,872.0 million, up from $5,716.8 million, indicating a rise of 37.7%[16] - Current assets rose to $4,191.2 million, compared to $4,050.4 million, marking an increase of 3.5%[16] - Goodwill increased significantly to $8,206.2 million from $6,609.7 million, reflecting a growth of 24.1%[16] Revenue Breakdown - Revenue from the United States market was $805.0 million for the period, compared to $735.1 million in the prior year, reflecting a year-over-year increase of 9.5%[140] - Revenue recognized at a point in time was $1,710.5 million, up from $1,615.8 million, which is a growth of 5.9%[140] - Revenue recognized over time was $150.5 million, compared to $123.1 million, reflecting a significant increase of 22.3%[140] - Original equipment revenue reached $1,176.8 million, an increase from $1,109.3 million, indicating a growth of 6.1%[140] - Aftermarket revenue was $684.2 million, compared to $629.6 million in the previous year, showing an increase of 8.7%[140] Acquisitions and Growth Strategy - The company completed multiple acquisitions in 2024, including Friulair for $143.3 million, Controlled Fluidics for $49.9 million, and CAPS for $99.4 million, aimed at expanding its product offerings and market share[30][31][34] - The Company completed the acquisition of ILC Dover for an initial cash consideration of $2,349.7 million, with contingent consideration of up to $75.0 million[37] - The aggregate revenue from acquisitions completed in 2024 was $131.3 million for the three-month period and $207.1 million for the nine-month period ended September 30, 2024[40] Expenses and Cost Management - Selling and administrative expenses for the three-month period ended September 30, 2024, were $334.3 million, an increase of $19.1 million, or 6.1%, compared to $315.2 million for the same period in 2023[191] - Other operating expense, net for the nine-month period ended September 30, 2024, was $142.8 million, an increase of $89.1 million compared to $53.7 million for the same period in 2023[196] - Interest expense increased to $63.8 million for the three months ended September 30, 2024, compared to $39.6 million in the same period of 2023[160] Cash Flow and Capital Expenditures - The company reported net cash provided by operating activities of $870.5 million, compared to $796.0 million in the prior period[23] - Free Cash Flow for the three-month period ended September 30, 2024, was $374.3 million, compared to $368.7 million for the same period in 2023[186] - The company incurred capital expenditures of $113.8 million during the period[23] Risks and Economic Factors - The company faces risks associated with instability in the global economy and financial markets, which may negatively impact revenues and liquidity[6] - Ingersoll Rand's operations are significantly exposed to international markets, with more than half of sales occurring in non-U.S. jurisdictions[6] - The company is subject to various risks, including credit and counterparty risks, which could adversely affect its business operations[6] Taxation - The effective income tax provision rate increased to 24.4% for the three months ended September 30, 2024, compared to 22.0% for the same period in 2023[145] - The provision for income taxes for the three-month period ended September 30, 2024, was $73.8 million, resulting in a 24.4% effective tax rate, compared to $60.3 million and 22.0% in the same period in 2023[200] Stock and Compensation - The company issued 0.2 million shares for stock-based compensation plans, contributing $5.1 million to capital in excess of par value[17] - Stock-based compensation expense increased to $43.6 million from $35.2 million in the previous period[23] - As of September 30, 2024, there was $124.9 million of total unrecognized compensation expense related to stock options and restricted stock units[82]

Core Insights - Ingersoll Rand Inc. reported third-quarter 2024 adjusted earnings of 84 cents per share, exceeding the Zacks Consensus Estimate of 82 cents, marking a 9.1% year-over-year increase [1] - Total revenues reached $1.86 billion, slightly below the consensus estimate of $1.88 billion, but still reflecting a 7% year-over-year growth [1] - The company raised its 2024 outlook, expecting revenue growth of 5-7% compared to the previous estimate of 6-8% [10][11] Financial Performance - Adjusted EBITDA for the quarter increased 9.5% year over year to $449.9 million, slightly below the estimate of $450.5 million [4] - The cost of sales rose 4.6% year over year to $1.0 billion, while selling and administrative expenses increased by 6.1% to $334.3 million [7] - Free cash flow increased by 5.1% to $756.7 million, with net cash from operating activities up 9.4% year over year [9] Segment Analysis - The Industrial Technologies & Services segment generated revenues of $1.47 billion, accounting for 78.8% of total revenues, with a year-over-year increase of 2.7% [3] - The Precision & Science Technologies segment reported revenues of $393.8 million, a 26.8% increase year over year, with acquisitions contributing 29.1% to revenue growth [5][6] - Orders for the Industrial Technologies & Services segment increased by 5.5%, while the Precision & Science Technologies segment saw a 30% rise in orders year over year [4][6] Balance Sheet and Cash Flow - As of the end of the third quarter, Ingersoll Rand had cash and cash equivalents of $1.4 billion, down from $1.6 billion at the end of December 2023, while long-term debt rose to $4.8 billion [8] - The company paid out dividends of $24.2 million and repurchased treasury stocks worth $198.2 million in the first nine months of 2024 [8] Future Outlook - Adjusted EBITDA for 2024 is expected to be in the range of $2.01-$2.04 billion, indicating a 12-14% increase from the prior year [11] - Adjusted earnings are anticipated to be between $3.28-$3.34 per share, reflecting an 11-13% increase from the previous year [11]

Financial Data and Key Metrics Changes - The company reported a 10% growth in total orders and a 7% increase in total revenue for Q3 2024, although organic revenue decreased by 2% [17][18] - Adjusted EBITDA for the quarter was $533 million, reflecting a 15% year-over-year improvement, with adjusted EBITDA margins expanding by 210 basis points to 28.6% [19][22] - Adjusted earnings per share (EPS) increased by 9% year-over-year to $0.84, while free cash flow for the quarter was $374 million, resulting in a free cash flow margin of 20% [20][22] Business Line Data and Key Metrics Changes - The Industrial Technologies and Service (ITS) segment achieved approximately 3% revenue growth, with adjusted EBITDA margins reaching a record high of 30.7%, up 190 basis points year-over-year [26] - The Product Solutions Technologies (PST) segment reported 3% organic order growth, with adjusted EBITDA of approximately $118 million and a margin of 30% [29] - Compressor orders increased by mid-single digits, while industrial vacuum and blower orders rose by high single digits [27] Market Data and Key Metrics Changes - Marketing qualified leads (MQLs) grew by 12% year-over-year and 7% sequentially, indicating positive demand generation [34] - The funnel activity for engineered-to-order compressor systems increased by 22% year-over-year, suggesting a healthy long-term outlook despite elongated decision-making processes [35][64] Company Strategy and Development Direction - The company remains committed to its long-term targets of double-digit adjusted EPS growth and strong free cash flow generation, with a focus on both organic and inorganic growth initiatives [8][9] - In 2024, the company has closed 15 transactions and has 10 additional deals under letter of intent (LOI), primarily targeting bolt-on acquisitions [13][21] - The company emphasizes its competitive differentiator, IRX, and aims to leverage data-driven insights to enhance customer experiences and drive revenue [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the underlying demand despite project push-outs, attributing delays to customer readiness and external factors such as election uncertainty [46][63] - The backlog grew year-over-year and sequentially, indicating a positive outlook for 2025 [54] - Management expects a gradual recovery in growth rates rather than a V-shaped rebound, with continued focus on executing within controllable parameters [53][66] Other Important Information - The company updated its full-year 2024 guidance, expecting total revenue growth of 5% to 7%, down from previous estimates due to order timing issues [36][39] - Corporate costs are projected to remain around $170 million, with adjusted EBITDA expected to be between $2.01 billion and $2.04 billion [39][40] Q&A Session Summary Question: Context on project push-outs and MQLs - Management noted that MQLs are a demand generation engine, and while they historically convert to orders within 6-8 weeks, this timeframe has elongated due to market conditions [46][47] Question: Current demand trends and geographic weaknesses - Management confirmed that while China remains a challenge, overall project delays are global, driven by site readiness and EPC issues [59][63] Question: Expectations for Q4 margins and 2025 - Management anticipates Q4 EBITDA margins to remain around 30%, with a gradual margin expansion expected in 2025 [70][71] Question: Impact of election uncertainty on project delays - Management acknowledged that election uncertainty is mentioned more frequently but is not the primary reason for project delays [75][78] Question: Service performance and growth expectations - Management reported positive momentum in service revenue, with strong demand across various regions [79] Question: M&A landscape for 2025 - Management expressed confidence in a robust M&A environment for 2025, with a focus on bolt-on acquisitions [89][90] Question: PST segment outlook for Q4 - Management expects a return to positive organic growth in the PST segment for Q4, supported by positive order momentum [92][96]

Core Insights - Ingersoll Rand (IR) reported $1.86 billion in revenue for Q3 2024, a 7% year-over-year increase, with an EPS of $0.84 compared to $0.77 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate by 0.84%, while the EPS exceeded the consensus estimate by 2.44% [1] Revenue Performance - Precision and Science Technologies revenue was $393.80 million, slightly above the average estimate of $393.66 million, reflecting a 26.8% year-over-year increase [3] - Industrial Technologies and Services revenue was $1.47 billion, below the estimated $1.49 billion, but still showing a 2.7% increase compared to the previous year [3] Adjusted EBITDA - Adjusted EBITDA for Precision & Science Technologies was reported at $118.10 million, slightly above the estimated $117.88 million [3] - Adjusted EBITDA for Industrial Technologies & Services was $449.90 million, exceeding the average estimate of $445.73 million [3] Stock Performance - Ingersoll's shares have returned -2.7% over the past month, contrasting with the Zacks S&P 500 composite's +1% change [4] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential outperformance against the broader market in the near term [4]