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]

Ingersoll Rand (IR) came out with quarterly earnings of $0.84 per share, beating the Zacks Consensus Estimate of $0.82 per share. This compares to earnings of $0.77 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 2.44%. A quarter ago, it was expected that this maker of flow control and compression equipment would post earnings of $0.77 per share when it actually produced earnings of $0.83, delivering a surprise of 7.79%.Over t ...

Financial Performance - Third quarter 2024 orders reached $1,799 million, an increase of 10% year-over-year[1] - Reported revenues for the third quarter were $1,861 million, up 7% compared to the same period last year[1] - Adjusted EBITDA for the third quarter was $533 million, reflecting a 15% increase and a margin of 28.6%, up 210 basis points year-over-year[1] - Adjusted EPS for the third quarter was $0.84, up from $0.75 in the prior year, representing a growth of 12%[1] - Free cash flow for the third quarter was $374 million, with a free cash flow margin of 20%[1] - Revenues for the quarter ended September 30, 2024, were $1,861.0 million, an increase from $1,738.9 million for the same period in 2023, representing a growth of 7.0%[15] - Gross profit for the quarter was $815.0 million, compared to $739.3 million in the prior year, reflecting a gross margin improvement[15] - Operating income increased to $356.3 million from $318.4 million year-over-year, indicating a growth of 11.9%[15] - Net income attributable to Ingersoll Rand Inc. for the quarter was $221.6 million, up from $208.3 million in the same quarter last year, a rise of 6.3%[15] - Basic earnings per share for the quarter were $0.55, compared to $0.51 in the prior year, marking an increase of 7.8%[15] - Net income for the nine-month period ended September 30, 2024, increased to $614.4 million, up from $553.6 million in the same period of 2023, representing a growth of 10.5%[18] - Adjusted EBITDA for the nine-month period ended September 30, 2024, was $1,485.8 million, compared to $1,286.3 million in 2023, reflecting an increase of 15.5%[19] - Free cash flow for the nine-month period ended September 30, 2024, reached $756.7 million, up from $720.2 million in 2023, indicating a growth of 5.0%[19] - Adjusted diluted earnings per share for the nine-month period ended September 30, 2024, was $2.45, up from $2.09 in 2023, reflecting a growth of 17.2%[20] - Net income for the quarter ended September 30, 2024, was $223.4 million, compared to $209.6 million for the same period in 2023, representing an increase of 3.9%[22] - Total revenue for the quarter was $1.861 billion, up from $1.739 billion in the previous year, reflecting a growth of 7.0%[22] - Adjusted EBITDA for the quarter was $532.7 million, compared to $461.5 million in the same quarter last year, indicating a year-over-year increase of 15.4%[21] - Free cash flow for the quarter was $374.3 million, slightly up from $368.7 million in the prior year, showing a growth of 1.5%[21] - Total orders for the quarter reached $1.799 billion, an increase from $1.638 billion in the same quarter of 2023, marking a growth of 9.8%[22] Guidance and Strategic Plans - The company has updated its full-year 2024 revenue growth guidance to a range of 5% to 7%[7] - Adjusted EBITDA guidance for 2024 is set between $2,010 million and $2,040 million, indicating a 12% to 14% increase over the previous year[7] - The company plans to continue capital deployment towards M&A and innovation to drive long-term value[2] Acquisitions and Investments - Ingersoll Rand closed multiple acquisitions in October 2024, enhancing its position in high-growth markets[5] - Net cash used in investing activities for the nine-month period ended September 30, 2024, was $2,872.8 million, significantly higher than $991.7 million in 2023, primarily due to increased acquisitions[18] - Proceeds from long-term debt for the nine-month period ended September 30, 2024, amounted to $3,296.9 million, compared to $1,490.4 million in 2023, indicating a substantial increase[18] Balance Sheet and Cash Flow - Total assets as of September 30, 2024, were $18,206.2 million, up from $15,563.5 million at the end of 2023, reflecting a growth of 17.0%[17] - Long-term debt increased to $4,782.5 million from $2,693.0 million, indicating a significant rise due to strategic investments[17] - Cash and cash equivalents decreased to $1,376.9 million from $1,595.5 million, showing a decline of 13.7%[17] - The company reported an increase in inventories to $1,162.5 million from $1,001.1 million, reflecting a growth of 16.1%[17] - Total stockholders' equity rose to $10,334.2 million from $9,846.7 million, an increase of 4.9%[17] - The cash and cash equivalents at the end of the period were $1,376.9 million, up from $1,197.5 million at the end of September 30, 2023[18] Tax and Expenses - The company reported a provision for income taxes of $73.8 million for the quarter, compared to $60.3 million in the same period last year, reflecting a 22.9% increase[22] - Interest expense for the quarter was $63.8 million, up from $39.6 million in the previous year, indicating a significant increase of 60.4%[22] - The company incurred restructuring and related business transformation costs of $9.7 million for the quarter, compared to $2.2 million in the same period last year[21] Organic Growth - Organic growth in total orders was 0.8%, while organic revenue growth showed a decline of 2.4% for the quarter[24] - The impact of acquisitions contributed 8.7% to order growth and 8.9% to revenue growth for the quarter[24]

Core Viewpoint - Ingersoll Rand Inc. is set to release its third-quarter 2024 results on October 31, with expectations of continued revenue and earnings growth based on historical performance and recent acquisitions [1][7]. Financial Performance Expectations - The consensus estimate for revenues is $1.9 billion, reflecting a year-over-year growth of 7.9% [2]. - The adjusted earnings estimate is 82 cents per share, indicating a 6.5% increase from the previous year [2][7]. Segment Performance Insights - The Industrial Technologies & Services segment is expected to see a revenue increase of 4.2% year over year, reaching $1.5 billion, driven by higher orders for industrial vacuums and stable compressor orders [3]. - The Precision and Science Technologies segment is anticipated to perform well, with a projected revenue increase of 17.2% year over year to $363.8 million, supported by growth in short-cycle orders and strong book-and-ship orders [4]. Impact of Acquisitions - Recent acquisitions, including ILC Dover, Complete Air and Power Solutions, Del PD Pumps & Gear Pvt Ltd, and Fruvac Ltd, are expected to enhance Ingersoll Rand's capabilities and revenue streams [5][6]. - The integration of these companies is anticipated to augment the product portfolio and strengthen the company's position in various markets, including biopharma and mobile vacuum solutions [6][7]. Margin and Profitability Considerations - Increasing costs of sales and rising selling and administrative expenses may negatively impact margins and profitability [8]. - Foreign-currency headwinds are also expected to affect the company's top line due to its substantial international presence [8]. Earnings Prediction - The company has an Earnings ESP of +1.22%, with the Most Accurate Estimate at 83 cents per share, suggesting a likelihood of an earnings beat [9].