IDEX’s third quarter was marked by solid execution and strong organic growth, leading to a positive market reaction. Management highlighted that momentum in Health & Science Technologies (HST), along with robust demand from data centers, municipal water, and pharma, were key drivers this quarter. CEO Eric Ashleman credited the company’s “8020 philosophy” for enabling operational improvements and rapid integration of recent acquisitions, while noting that recent efforts in the Material Science Solutions platform and intelligent water businesses contributed meaningfully to performance.
Is now the time to buy IEX? Find out in our full research report (it’s free for active Edge members).
IDEX (IEX) Q3 CY2025 Highlights:
- Revenue: $878.7 million vs analyst estimates of $861.1 million (10.1% year-on-year growth, 2% beat)
- Adjusted EPS: $2.03 vs analyst estimates of $1.93 (5.2% beat)
- Adjusted EBITDA: $239.8 million vs analyst estimates of $227.2 million (27.3% margin, 5.5% beat)
- Revenue Guidance for Q4 CY2025 is $871.5 million at the midpoint, below analyst estimates of $889.7 million
- Management reiterated its full-year Adjusted EPS guidance of $7.89 at the midpoint
- EBITDA guidance for the full year is $923.7 million at the midpoint, in line with analyst expectations
- Operating Margin: 21.1%, in line with the same quarter last year
- Organic Revenue rose 5% year on year vs analyst estimates of 2.6% growth (235.7 basis point beat)
- Market Capitalization: $12.56 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From IDEX’s Q3 Earnings Call
- Deane Dray (RBC Capital Markets) asked about business tone and order trends; CEO Eric Ashleman described industrial demand as stable but lacking inflection, with order cycles elongating rather than canceling.
- Michael Halloran (Baird) questioned how portfolio changes impact forward growth; Ashleman explained the shift toward higher-growth platforms should move organic growth closer to mid-single digits over time.
- Joseph Giordano (TD Cowen) asked if recent acquisitions changed IDEX’s unique positioning; Ashleman emphasized the company’s “classic” engineering culture and adaptability, noting new markets require similar operational discipline.
- Nathan Jones (Stifel) inquired about further cost reduction potential; Ashleman confirmed more structural savings could be realized, particularly through platform consolidation, though management is cautious about disrupting customer service.
- Bryan Blair (Oppenheimer & Company) asked about the Intelligent Water platform’s growth and demand visibility; Ashleman cited strong municipal demand, increased software integration, and critical infrastructure roles as supporting continued growth.
Catalysts in Upcoming Quarters
In upcoming quarters, our analysts will focus on (1) the pace of organic growth in HST and municipal water platforms, (2) management’s ability to sustain margin improvements through ongoing cost initiatives, and (3) signs of stabilization or acceleration in industrial demand across bellwether businesses. Progress on bolt-on acquisitions and the execution of platform integrations will also be key indicators of future performance.
IDEX currently trades at $167.96, in line with $166.95 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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