Latest news with #GTLS
Yahoo
04-06-2025
- Business
- Yahoo
Chart + Flowserve Just Dropped a $19B Bombshell--Industrial Tech May Never Look the Same
Chart Industries (NYSE:GTLS) and Flowserve (NYSE:FLS) are joining forces in a headline-making $19 billion all-stock merger that could create one of the most dominant players in global industrial process technologies. Announced this week, the deal brings together two highly complementary businesses with a combined installed base of over 5.5 million assets across more than 50 countries. Chart shareholders will receive 3.165 shares of Flowserve for every GTLS share, giving them a 53.5% stake in the new entity. The combined company expects to generate $8.8 billion in revenue, with nearly half of that coming from high-margin aftermarket services. Warning! GuruFocus has detected 4 Warning Signs with GTLS. But this merger isn't just about scaleit's about a full-stack transformation. From cryogenic compression to digital flow management, the new firm wants to offer cradle-to-grave solutions for sectors like LNG, carbon capture, data centers, and even space. It's aiming for $300 million in cost synergies within three years, plus new cross-selling revenue opportunities that could lift topline growth by another 2%. With recurring revenue already at 42% of the total mix, management sees a path to more predictable cash flows and durable margins. Jill Evanko (Chart) will become Board Chair, while Scott Rowe (Flowserve) steps in as CEO. And the numbers? On a trailing 12-month basis, the combined entity pulled in $1.8 billion in cash flow. Management expects the deal to be accretive to adjusted EPS in year one, while maintaining a 2.0x net debt-to-EBITDA ratiosupporting steady dividends and balance sheet strength. If the deal clears shareholder and regulatory hurdles, the new firm will launch under a fresh brand name in late 2025, with headquarters in Dallas and major offices in Atlanta and Houston. For investors betting on long-term infrastructure and energy tech, this could be one to watch. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
04-06-2025
- Business
- Yahoo
Chart-Flowserve merger, Nio R&D, Amazon's $10B AI investment
Yahoo Finance host Josh Lipton tracks today's top moving stocks and biggest market stories in this Market Minute, including Chart Industries (GTLS) and Flowserve (FLS) announcing their merger, Nio's (NIO) goals to reduce research and development (R&D) spending, and Amazon (AMZN) planning a $10 billion investment into its North Carolina data centers. Stay up to date on the latest market action, minute-by-minute, with Yahoo Finance's Market Minute.
Yahoo
15-05-2025
- Business
- Yahoo
GTLS Q1 Earnings Call: Chart Maintains Guidance Amid Tariff Uncertainty and Broad Market Demand
Gas handling company Chart (NYSE:GTLS) met Wall Street's revenue expectations in Q1 CY2025, with sales up 5.3% year on year to $1 billion. The company's full-year revenue guidance of $4.75 billion at the midpoint came in 2.5% above analysts' estimates. Its non-GAAP profit of $1.71 per share was 6.4% below analysts' consensus estimates. Is now the time to buy GTLS? Find out in our full research report (it's free). Revenue: $1 billion vs analyst estimates of $1 billion (5.3% year-on-year growth, in line) Adjusted EPS: $1.71 vs analyst expectations of $1.83 (6.4% miss) Adjusted EBITDA: $231.1 million vs analyst estimates of $226.3 million (23.1% margin, 2.1% beat) The company reconfirmed its revenue guidance for the full year of $4.75 billion at the midpoint Management reiterated its full-year Adjusted EPS guidance of $12.50 at the midpoint EBITDA guidance for the full year is $1.2 billion at the midpoint, above analyst estimates of $1.16 billion Operating Margin: 15.2%, up from 11.9% in the same quarter last year Free Cash Flow was -$80.1 million compared to -$141.2 million in the same quarter last year Backlog: $5.14 billion at quarter end, up 18.8% year on year Market Capitalization: $7.87 billion Chart's first quarter results reflected continued demand across key end markets, with management citing strong order activity in areas such as LNG, space exploration, and aftermarket services. CEO Jillian Evanko specifically pointed to operational efficiencies and improved project mix as drivers of margin expansion, while also highlighting sequential improvements in backlog and segment-level performance. The company's focus on cost controls and leveraging a flexible manufacturing footprint were emphasized as contributors to the quarter's performance. Looking ahead, management reiterated its full-year revenue and profit guidance, despite uncertainty related to global tariffs and macroeconomic volatility. Evanko detailed mitigation strategies including regional sourcing, price increases in certain business lines, and a growing emphasis on aftermarket services, stating, 'We believe that we're well underway in mitigating these tariffs, and that gives us confidence.' Management also emphasized visibility provided by a diversified backlog and strong pipeline across industries such as data centers and carbon capture. Chart's management attributed Q1 performance to a combination of diversified demand, operational improvements, and proactive tariff mitigation. Segment-specific trends and strategic actions shaped the quarter's outcomes and will influence the company's trajectory in 2025. Aftermarket Services Growth: The Repair, Service & Leasing (RSL) segment, which now represents about a third of revenue and half of operating profit, benefited from expanded service agreements and increased digital tool adoption. Orders in RSL grew over 36% year-over-year, with management noting broad-based demand across retrofit, service, and spares. Data Centers and AI Energy Demand: Chart's pipeline for data center solutions, including heat exchangers and cryogenic cooling, expanded to $400 million in potential opportunities over the next 12–18 months. Management added a dedicated commercial lead for this segment and cited increased customer discussions around energy-intensive AI projects. Specialty Products Margin Recovery: Specialty Products achieved gross margin above 30% for the first time since 2022, driven by improved efficiencies and backlog conversion in hydrogen, water treatment, and power generation. Management expects further gains as recent capacity investments are absorbed. Tariff Mitigation Actions: The company outlined steps such as regional sourcing, flexible manufacturing, selective price increases, and securing tariff exemptions to limit the impact of new trade measures. Most steel is sourced domestically, and backlog pricing is largely locked in for current projects. Diversified End Market Exposure: Orders in space exploration, nuclear, and marine each exceeded full-year 2024 levels in just the first quarter, reflecting the company's broader presence across industries. Management highlighted this diversification as a buffer against potential weakness in industrial gas and hydrogen markets in the Americas. Management anticipates that backlog visibility, proactive cost actions, and expansion into high-growth markets will shape Chart's performance for the remainder of the year. Aftermarket Emphasis: A greater reliance on service and maintenance business provides recurring revenue streams and stability, even amid potential slowdowns in new equipment orders. Management expects this area to continue growing and to support margins. Data Center and LNG Pipeline: Chart's addressable market in data centers and LNG projects is expanding, with a $1 billion potential LNG order pipeline and growing interest in cryogenic and energy efficiency solutions for AI infrastructure. Management views these as key growth engines. Tariff and Macro Risks: While management has implemented mitigation strategies for tariffs and supply chain disruptions, ongoing global economic uncertainty and potential project delays in certain sectors (notably hydrogen and industrial gas in the Americas) remain watch areas. Scott Gruber (Citigroup): Asked about Chart's exposure to China and how U.S.-based fabrication destined for China could be shifted. CEO Jillian Evanko explained that most manufacturing for China occurs locally and that recent tariff exemptions have reduced material exposure by about 40%. Saurabh Pant (Bank of America): Inquired about macroeconomic risks and visibility into backlog coverage. Evanko highlighted diversification across end markets and a strong service business as factors supporting guidance, while noting hydrogen and industrial gas as risk areas. Marc Bianchi (TD Cowen): Sought clarification on the effectiveness of tariff mitigation and whether guidance assumed any benefits. Evanko confirmed that guidance is based on gross tariff impact, with mitigation efforts already underway but not yet reflected in results. Eric Stine (Craig-Hallum): Questioned the sustainability of recent growth in new end markets like space exploration. Evanko described an evolution toward greater visibility and recurring content across multiple sectors, supported by a growing backlog. Benjamin Nolan (Stifel): Asked about the acceleration of LNG activity. Evanko confirmed increased customer urgency and identified a $1 billion LNG order pipeline, excluding certain large projects not yet in backlog. Over the next few quarters, the StockStory team will monitor (1) the pace of large LNG and data center orders converting into backlog, (2) the sustainability of margin improvements in Specialty Products and RSL, and (3) the effectiveness of tariff mitigation as new trade policies are implemented. Developments in hydrogen and industrial gas demand in the Americas will also be key indicators for overall business momentum. Chart currently trades at a forward P/E ratio of 13.5×. Should you load up, cash out, or stay put? The answer lies in our free research report. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
