Flowserve Serves Up Steady Growth; Consistent Dividend


Second-quarter earnings season is in full effect and the results have been pretty darn good.

Of course, the naysayers were a vocal bunch a few weeks ago, saying that earnings would generally be weak, but that hasn't been the case at all. Some misses in the large-cap space, yes, but scads of small- and midcap names continue to deliver the goods.

Flowserve ( FLS ), a maker of industrial equipment, reported earnings before the open Thursday. It's another example of a stock with strong fundamentals and technicals with a consistent track record of dividend growth.

The company's product portfolio includes pumps, valves and seals. It also provides aftermarket equipment services to the oil and gas, chemical, power generation and water-management industries.

Flowserve split its shares 3-for-1 in late June, which cut its quarterly dividend from 42 cents down to 14 cents, giving it an annual yield of 1%.

Early Wednesday, the company topped earnings and sales expectations. Profit and sales growth accelerated from the first quarter, with earnings up 24% from a year ago to 84 cents a share. Sales rose 5% to $1.24 billion. Earnings benefited from continued growth in bookings and improving margins.

Sales at Flowserve's Engineered Product Division rose 7% to $625 million thanks to increased equipment sales in North America, Europe and Asia Pacific. Sales at its Flow Control Division rose 2% to $384 million. Bookings rose nearly 9% to $447 million, helped by strong demand from the oil and gas and chemical industries.

Price and volume trends in Flowserve continue to look good. The stock is carving a base-on-base pattern with a buy point of 57.86.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Investing Ideas

Referenced Stocks: FLS

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