Core Viewpoint - JBT Marel (JBTM) is considered a superior value option compared to Enpro (NPO) based on various valuation metrics [7] Valuation Metrics - JBTM has a forward P/E ratio of 21.00, while NPO has a forward P/E of 30.23 [5] - JBTM's PEG ratio is 1.52, indicating a more favorable valuation relative to its expected earnings growth compared to NPO's PEG ratio of 2.02 [5] - JBTM's P/B ratio stands at 1.83, whereas NPO has a P/B ratio of 3.64, suggesting that JBTM is undervalued in terms of market value versus book value [6] Earnings Outlook - Both JBTM and NPO have a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions and an improving earnings outlook for both companies [3]

Group 1: Company Performance - Enpro (NPO) has gained approximately 28.2% year-to-date, outperforming the average loss of 7.9% in the Business Services group [4] - Enpro holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook and improving analyst sentiment, with a 0.6% increase in the consensus estimate for full-year earnings over the past three months [3] - Quad/Graphics (QUAD) has also shown strong performance, returning 12.1% since the beginning of the year, and it also holds a Zacks Rank of 2 (Buy) [4][5] Group 2: Industry Context - The Business Services sector includes 237 companies and is currently ranked 14 in the Zacks Sector Rank, which evaluates sectors based on the average Zacks Rank of individual companies [2] - Enpro is part of the Technology Services industry, which consists of 109 stocks and is ranked 161 in the Zacks Industry Rank, with an average loss of 8.5% this year [5] - Quad/Graphics belongs to the Advertising and Marketing industry, which has 15 stocks and is ranked 83, with a year-to-date decline of 5.2% [6]

Financial Performance - Total third-party sales for the year ended December 31, 2025, were $1,143.3 million, with the semiconductor market contributing $367.1 million, representing 32.1% of total sales[32]. - The company’s fixed rate debt obligations as of December 31, 2025, totaled $450.7 million, with an average interest rate of 6.1%[256]. Order Backlog - The order backlog as of December 31, 2025, was valued at $256.7 million, an increase from $240.6 million at December 31, 2024, with $126.2 million related to Sealing Technologies and $130.6 million to Advanced Surface Technologies[60]. Sales Distribution - Approximately 41% of Sealing Technologies segment sales in 2025 were delivered to customers outside the United States[46]. - Advanced Surface Technologies segment sales included approximately 48% delivered to customers outside the United States in 2025[54]. Segments and Operations - The Sealing Technologies segment generates approximately two-thirds of its total revenue from aftermarket or recurring revenue[35]. - The Sealing Technologies segment includes three operating divisions: Garlock, Technetics, and STEMCO, focusing on critical environments and safety[33]. - The Advanced Surface Technologies segment applies proprietary technologies to deliver products for high-growth markets, including semiconductor manufacturing and life sciences[49]. Research and Development - Research and development efforts are directed towards developing new solutions for demanding environments and advancing technology for semiconductor manufacturing equipment[59]. Quality Assurance - As of December 31, 2025, 29 manufacturing and service facilities were ISO 9001 certified, and four facilities were ISO 14001 certified, indicating a strong commitment to quality assurance[62]. Workforce and Employee Development - As of December 31, 2025, the company had approximately 4,000 employees, with 63% in North America, 27% in Asia Pacific, and 10% in Europe[65]. - The company launched "Enpro 3.0" in Q1 2025, a multi-year transformation initiative aimed at driving long-term profitable growth and enhancing employee development[67]. - The company maintains a dual-bottom line philosophy, emphasizing both financial results and human development[67]. - The company has improved its employee benefits programs, including a minimum wage of $17 per hour and enhanced healthcare benefits[73]. - The company has implemented an AI-based ergonomic assessment tool to reduce ergonomic-related injuries across its facilities[71]. Safety Performance - In 2025, the company achieved an OSHA recordable injury case rate of 0.64 and a lost time injury case rate of 0.09, representing improvements of 33% and 70% compared to 2024 rates[69]. Community Engagement - The company has contributed $2.25 million to the Enpro Foundation since its formation in 2020, with $1.6 million in donations made to charitable organizations[78]. Labor Relations - The company’s collective bargaining agreement at the Garlock facility expired on February 15, 2026, leading to a work stoppage pending negotiations[65]. Financial Instruments - The company entered into a forward contract to hedge a €95 million exposure related to an intercompany note agreement, with notional amounts of $103.7 million and $110.5 million as of December 31, 2024 and 2023, respectively[257].

Core Insights - Enpro (NPO) reported revenue of $295.4 million for the quarter ended December 2025, marking a year-over-year increase of 14.3% and exceeding the Zacks Consensus Estimate by 5.31% [1] - The earnings per share (EPS) for the same period was $1.99, compared to $1.57 a year ago, representing a surprise of 4.01% over the consensus estimate of $1.91 [1] Financial Performance - Enpro's revenue performance in key segments includes: - Advanced Surface Technologies: $108.4 million, exceeding the average estimate of $103.27 million, with a year-over-year change of +13.4% [4] - Sealing Technologies: $187.1 million, surpassing the average estimate of $177.37 million, with a year-over-year change of +14.8% [4] - Elimination of intersegment sales: $-0.1 million, consistent with the average estimate, reflecting a year-over-year change of -50% [4] Market Performance - Enpro's shares have returned +15.1% over the past month, contrasting with the Zacks S&P 500 composite's decline of -1.3% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Enpro's total sales increased by 9% to $1.14 billion in 2025, driven by strong performance in aerospace, food and biopharma, and semiconductor markets [5][12] - Adjusted EBITDA for the fourth quarter was $69.4 million, up 19.2%, with an adjusted EBITDA margin of 23.5%, an increase of 100 basis points [14] - Adjusted diluted earnings per share rose nearly 27% to $1.99 compared to the prior year period [14] Business Line Data and Key Metrics Changes - Sealing Technologies sales increased by almost 15% to $187.1 million in the fourth quarter, with organic sales up nearly 8% year-over-year [15] - Advanced Surface Technologies (AST) sales grew by 13.4% to $108.4 million, with continued strength in precision cleaning solutions [16] - Adjusted segment EBITDA margin for Sealing Technologies expanded to 32.8%, while AST maintained a margin above 20% [16][17] Market Data and Key Metrics Changes - The aerospace and food and biopharma markets showed healthy demand, while commercial vehicle OEM demand remained weak [15][38] - The overall industrial business is strong, with order demand remaining robust across various sectors [38] Company Strategy and Development Direction - Enpro's strategy focuses on organic growth of mid- to high single digits through 2030, with a commitment to strategic acquisitions that enhance capabilities [4][10] - The company aims to maintain premium profitability and return levels while investing in growth and efficiency projects [3][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of 2026, anticipating improved order flow and recovery in semiconductor capital equipment spending [9][21] - The company remains well-positioned to participate in a stronger semiconductor market and expects to leverage recent investments for growth [9][23] Other Important Information - Enpro generated over $150 million in free cash flow in 2025, up 18% from the previous year [19] - The company recorded its best safety statistics ever in 2025, with a total recordable incident rate of 0.64 [25][26] - A quarterly dividend increase to $0.32 per share was approved, marking the eleventh consecutive annual increase since 2015 [20] Q&A Session Summary Question: Can you provide more detail on AST's margin expectations for the first and second halves of the year? - Management indicated that the second half is expected to be considerably stronger, with growth rates accelerating and margins improving as growth programs contribute [34][35] Question: What are the current order patterns and customer sentiments? - Management noted that order patterns are improving, with customers showing increased confidence and order rates returning to previous levels [35][38] Question: How did the fourth quarter performance compare to previous guidance? - Sales were at the higher end of expectations, while margins were slightly impacted by increased corporate expenses and medical costs [43] Question: What is the outlook for free cash flow conversion in 2026? - Management expects strong free cash flow conversion to remain around 100% of adjusted EPS, despite higher capital expenditures [46][47] Question: Has the focus on M&A shifted? - The company continues to pursue strategic acquisitions aggressively, maintaining a strong pipeline of potential targets [50][51]

Financial Data and Key Metrics Changes - Enpro reported a 9% increase in sales for 2025, reaching $1.14 billion, driven by strength in aerospace, food and biopharma, and semiconductor markets [5][12] - Adjusted EBITDA for the fourth quarter was $69.4 million, up 19.2%, with an Adjusted EBITDA margin of 23.5%, an increase of 100 basis points [14] - Adjusted diluted earnings per share increased nearly 27% to $1.99 compared to the prior year period [14] Business Line Data and Key Metrics Changes - Sealing Technologies sales increased almost 15% in the fourth quarter to $187.1 million, with organic sales up nearly 8% year-over-year [15] - Advanced Surface Technologies (AST) sales increased 13.4% to $108.4 million, with continued strength in precision cleaning solutions [16] - Adjusted segment EBITDA margin for Sealing Technologies expanded 180 basis points to 32.8% [15] Market Data and Key Metrics Changes - The aerospace and food and biopharma markets showed healthy demand, while commercial vehicle OEM demand remained weak [15][38] - The semiconductor capital equipment market is expected to recover in the second half of 2026, with improved order patterns noted [9][23] Company Strategy and Development Direction - Enpro's strategy, Enpro 3.0, aims for mid- to high single-digit organic growth through 2030, focusing on growth and efficiency projects [4][10] - The company plans to allocate two-thirds of capital expenditures towards growth initiatives and strategic acquisitions [3][10] - Enpro is committed to maintaining premium profitability and strong returns on invested capital [7][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate robust free cash flow and maintain a strong balance sheet despite recent acquisitions [9][19] - The outlook for 2026 includes total sales growth of 8%-12%, with Adjusted EBITDA expected to be in the range of $305 million-$320 million [21] - Management noted that while commercial vehicle OEM demand is expected to remain flat, aftermarket drivers in that market are stable [22][38] Other Important Information - Enpro recorded its best safety statistics ever in 2025, with a total recordable incident rate of 0.64 [25][26] - The company has expanded its revolving credit facility to $800 million, maintaining over $580 million in available capacity [20] Q&A Session Summary Question: Can you provide more detail on AST's margin expectations for the first and second half of the year? - Management indicated that the second half is expected to be considerably stronger than the first half, with growth programs starting to contribute significantly [33][34] Question: What are the current order patterns and customer sentiments? - Management noted that order patterns are improving, with customers showing increased excitement in placing orders, particularly in the semiconductor sector [35][37] Question: How did the fourth quarter performance compare to previous guidance? - Management stated that sales were at the higher end of expectations, while margins were slightly softer due to increased corporate expenses [42][43] Question: What is the outlook for cash conversion in 2026 given the higher CapEx? - Management expects strong free cash flow conversion to remain around 100% of Adjusted EPS, despite higher interest expenses due to recent acquisitions [46][47] Question: Has the focus on M&A shifted? - Management confirmed that the focus remains aggressive on M&A, with a disciplined approach to pursuing strategic opportunities [50][51]

Financial Data and Key Metrics Changes - Enpro reported a 9% increase in sales for 2025, reaching $1.14 billion, driven by strong performance in aerospace, food and biopharma, and semiconductor markets [5][12] - Adjusted EBITDA for Q4 2025 was $69.4 million, up 19.2%, with an adjusted EBITDA margin of 23.5%, an increase of 100 basis points [13] - Adjusted diluted earnings per share for Q4 2025 increased nearly 27% to $1.99, primarily due to higher adjusted EBITDA and lower interest expenses [13] Business Line Data and Key Metrics Changes - Sealing Technologies sales increased almost 15% in Q4 2025 to $187.1 million, with organic sales up nearly 8% year-over-year [14] - Advanced Surface Technologies (AST) sales rose 13.4% to $108.4 million in Q4 2025, driven by strength in precision cleaning solutions [15] - Adjusted segment EBITDA margin for Sealing Technologies expanded 180 basis points to 32.8%, while AST maintained a margin above 20% [15][16] Market Data and Key Metrics Changes - The aerospace and food and biopharma markets showed strong demand, while commercial vehicle OEM demand remained weak [14][38] - The semiconductor capital equipment market is expected to recover in the second half of 2026, with improved order flow anticipated [9][23] Company Strategy and Development Direction - Enpro's strategy focuses on organic growth of mid- to high single digits through 2030, with a commitment to strategic acquisitions that enhance capabilities [4][10] - The company aims to maintain premium profitability and return levels, with a focus on leveraging engineering expertise and applied capabilities [8][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate strong free cash flow and maintain a robust balance sheet despite recent acquisitions [9][19] - The outlook for 2026 includes total sales growth of 8%-12%, with expectations for adjusted EBITDA between $305 million and $320 million [20][21] Other Important Information - Enpro recorded its best safety statistics in 2025, with a total recordable incident rate of 0.64 and a lost time case rate of 0.09 [25] - The company plans to increase its quarterly dividend to $0.32 per share, marking the eleventh consecutive annual increase since initiating dividends in 2015 [19] Q&A Session Summary Question: Can you provide more detail on AST's margin expectations for the first and second halves of the year? - Management indicated that the second half is expected to be considerably stronger, with growth rates accelerating and margins improving as new growth programs contribute [34][35] Question: How did the last couple of months of the year compare to your November guidance? - Sales were at the higher end of expectations, while margins were slightly softer due to increased corporate expenses, particularly in medical costs [42][43] Question: What is the outlook for cash conversion in 2026 given the higher CapEx? - Management expects strong free cash flow conversion to remain around 100% of adjusted EPS, despite higher interest expenses due to recent acquisitions [46][47] Question: Has the focus on M&A shifted at all? - No, the company continues to pursue strategic acquisitions aggressively, maintaining a strong pipeline of potential targets [48][50] Question: How are the newly acquired businesses performing? - Both Alpha and Overlook are exceeding expectations with strong backlogs and order rates, contributing positively to the Sealing Technologies segment [57][58]

Core Viewpoint - Enpro (NPO) reported quarterly earnings of $1.99 per share, exceeding the Zacks Consensus Estimate of $1.91 per share, and showing an increase from $1.57 per share a year ago, indicating a positive earnings surprise of +4.01% [1] Financial Performance - Enpro achieved revenues of $295.4 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 5.31%, and up from $258.4 million in the same quarter last year [2] - The company has exceeded consensus EPS estimates three times over the last four quarters and topped consensus revenue estimates four times in the same period [2] Stock Performance - Enpro shares have increased approximately 25.8% since the beginning of the year, contrasting with the S&P 500's zero return [3] Future Outlook - The company's earnings outlook is crucial for assessing future stock performance, with current consensus EPS estimates at $2.08 for the coming quarter and $8.77 for the current fiscal year [7] - The Zacks Rank for Enpro is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Technology Services industry, to which Enpro belongs, is currently ranked in the bottom 45% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Statements in this presentation that express a belief, expectation, or intention, including 2026 guidance and other statements that are not historical fact, are forward-looking statements under the Private Securities Litigation Reform Act of 1995. They involve a number of risks and uncertainties that may cause actual events and results to differ materially from such forward- looking statements. These risks and uncertainties include, but are not limited to: economic conditions in the markets served by the co ...

Financial Performance - Sales for Q4 2025 were $295.4 million, an increase of 14.3%, with organic sales growth of 9.9%[3] - Full-year 2025 sales reached $1.14 billion, up 9.0%, with organic sales increasing by 7.6%[11] - GAAP net loss for Q4 2025 was $32.0 million, compared to a net income of $13.9 million in the prior year, primarily due to a $67.2 million pension settlement loss[6] - Adjusted EBITDA for Q4 2025 increased by 19.2% to $69.4 million, driven by strong performance in Sealing Technologies[7] - Adjusted diluted earnings per share for Q4 2025 rose 26.8% to $1.99, compared to $1.57 in the previous year[3] - Enpro's net sales for the year ended December 31, 2025, were $1,143.3 million, an increase of 9.0% from $1,048.7 million in 2024[30] - The company's gross profit for 2025 was $487.5 million, representing a gross margin of 42.6%, compared to $444.8 million and a margin of 42.5% in 2024[30] - Operating income for 2025 was $161.6 million, up from $142.3 million in 2024, reflecting a growth of 13.5%[30] - The net income for the year ended December 31, 2025, was $40.5 million, compared to $72.9 million in 2024, indicating a decrease of about 44.4%[44] - The adjusted net income for the year ended December 31, 2025, was $168.0 million, compared to $146.9 million in 2024, representing an increase of about 14.1%[45] - The adjusted diluted earnings per share for the year ended December 31, 2025, were $7.91, compared to $6.96 in 2024, indicating an increase of approximately 13.6%[45] Segment Performance - The Sealing Technologies segment reported sales of $187.1 million in Q4 2025, a 14.8% increase year-over-year[8] - Advanced Surface Technologies segment sales grew by 13.4% to $108.4 million in Q4 2025[10] - The Adjusted Segment EBITDA for Sealing Technologies in 2025 was $240.7 million, with a margin of 32.9%, compared to $224.1 million and a margin of 32.6% in 2024[36][37] - The Advanced Surface Technologies segment generated $411.6 million in sales for 2025, a 13.6% increase from $362.2 million in 2024[35] Cash Flow and Leverage - Free cash flow for 2025 increased by 18% to $153.1 million, net of capital expenditures[14] - Enpro ended 2025 with a net leverage ratio of approximately 2.0x and $114.7 million in cash[15] - Enpro's operating cash flow for 2025 was $201.2 million, an increase from $162.9 million in 2024[32] - Free cash flow for the year ended December 31, 2025, was $153.1 million, up from $130.0 million in 2024, representing an increase of 17.2%[50] - Net cash provided by operating activities for 2025 was $201.2 million, compared to $162.9 million in 2024, reflecting a growth of 23.5%[50] Expenses and Adjustments - The company incurred acquisition expenses of $8.5 million for the year ended December 31, 2025, up from $4.3 million in 2024, reflecting a 97.7% increase[45] - Restructuring and impairment expenses for the year ended December 31, 2025, totaled $1.7 million, compared to $5.8 million in 2024, showing a decrease of approximately 70.3%[43] - The total depreciation and amortization expense for the year ended December 31, 2025, was $102.8 million, compared to $100.3 million in 2024, reflecting a modest increase of about 2.5%[43] - Depreciation and amortization expense increased to $27.2 million in Q4 2025 from $25.3 million in Q4 2024[48] - Interest expense decreased to $6.3 million in Q4 2025 from $7.8 million in Q4 2024, indicating a reduction of 19.2%[48] - Environmental reserve adjustments increased to $6.2 million in Q4 2025 from $3.4 million in Q4 2024, a rise of 82.4%[48] - Acquisition expenses rose to $5.3 million in Q4 2025 compared to $0.5 million in Q4 2024, marking a significant increase[48] Guidance and Future Outlook - The company introduced guidance for 2026, expecting total revenue growth in the range of 8% to 12% and adjusted EBITDA between $305 million and $320 million[20] - The company anticipates continued growth in semiconductor and life sciences markets, with guidance for 2026 subject to various risks and uncertainties[27] Pension and Settlement - The company recognized a non-cash settlement loss of $67.2 million related to pension settlements in the fourth quarter of 2025[44] - The company completed the termination and settlement process for its defined benefit pension plan in the U.S. in Q4 2025[48]