IDEX Corporation demonstrates steady margins, strong cash conversion, and a conservatively leveraged balance sheet, although recent tekenen exhibit weakening in earnings growth and return on capital. Business Profile and Financial Strengths IDEX Corporation is an industrial technology and engineered-products company that sells flow- and motion-control equipment and specialty engineered solutions.
IDEX Corporation demonstrates steady margins, strong cash conversion, and a conservatively leveraged balance sheet, although recent tekenen exhibit weakening in earnings growth and return on capital.
IDEX Corporation is an industrial technology and engineered-products company that sells flow- and motion-control equipment and specialty engineered solutions. It presents a profile of steady margins, strong cash conversion, and a conservatively leveraged balance sheet.
Demonstrates persistent pricing power and operating efficiency, supported by an earnings quality profile indicating operating cash flow has exceeded net income on reported dates ($569.3M vs $483.2M) and an average cash conversion ratio of about 1.24.
There are, however, visible areas of weakening. Diluted EPS growth remains negative year-over-year at about -4.3%, with the most recent diluted EPS at $6.37. Revenue‑per-share growth has decelerated into negative territory (-4.1% most recent), creating a divergence between rising RPS levels (\$46.51) and softer per-share earnings.
Trailing net income has fallen from a 2024 peak of $719.0M to $483.2M most recently, and trailing twelve‑month ROE declined to 12.0% from a high of 24.6% in mid‑2022, signaling a pullback in return on capital that warrants attention.
For more details, see Profit Margin Trends, Earnings Quality Analysis, Revenue & Net Income, EPS Diluted & Revenue per Share, Revenue & EPS Growth, Return on Equity (ROE), Cash Flow Allocation, and PE Ratio Trend.
The foundation of business quality and long-term value creation
IDEX CORP /DE/’s revenue has trended upward over the multi-year record shown, rising from the mid-$500M range in 2017 to generally $800M–$900M in recent quarters. Revenue exceeded $800M consistently from 2022 onward, with a pronounced one-quarter spike to $1.58B at 2023-12-31. In the most recent quarters, revenue was $899.1M for 2025-12-31 and $886.9M for 2026-03-31, a slight decline quarter-over-quarter from the late-2025 peak.
Net income has shown greater variability than revenue, mostly clustering in the $100M–$250M range across many quarters but with large outliers: $247.2M at 2023-12-31 and $483.2M at 2025-12-31. The most recent quarter, 2026-03-31, reported net income of $120.0M, a return to levels similar to several earlier quarters. The most recent quarterly revenue was $886.9M. The most recent quarterly net income was $120.0M.
Why Growth Matters
Consistent revenue and earnings growth are the lifeblood of successful long-term investments. Companies that can grow their top line (revenue) and bottom line (net income) over many years demonstrate they have products or services customers value and are willing to pay for repeatedly.
Revenue Growth shows whether the company is expanding its market reach, gaining market share, or successfully launching new products.Net Income Growth demonstrates the company can convert that revenue into actual profits while managing costs effectively.
Look for steady, sustainable growth rather than erratic spikes. The best businesses compound earnings year after year, creating tremendous value for shareholders over time. Companies that can grow earnings faster than revenue are improving their profitability—a sign of operational excellence and competitive strength.
Year-over-year growth rates for revenue and earnings per share
Reading the Growth Rate Chart
This chart converts the absolute per-share figures into year-over-year percentage changes, making it easy to see whether growth is accelerating, decelerating, or reverting to trend — regardless of the company's absolute size.
Revenue per Share Growth (1-year, split-adjusted) measures how quickly the top line is expanding on a per-share basis. Sustained positive growth signals that the company continues to win customers and grow its addressable market.EPS Diluted Growth (1-year, split-adjusted) measures how quickly earnings are compounding for each shareholder. When EPS growth consistently outpaces revenue growth, operating leverage and margin expansion are at work.
Look for consistency, not just magnitude. A company that reliably grows EPS 10–15% per year is far more valuable than one that alternates between 50% spikes and deep contractions. Negative EPS growth during a period of positive revenue growth is a red flag — costs are rising faster than sales. Quarters where both lines converge near zero or go negative deserve close scrutiny.
How revenue converts to net income for the most recent annual period
Period Information
Report Type: Annual (10-K)
Period: Apr 2025 to Mar 2026
Analyzing long-term margin stability and competitive positioning
IDEX CORP /DE/ shows a long-running stable gross margin in the mid-40s, with values clustered between about 44.0% and 45.2% across the historical series. Operating margin has generally sat in the low- to mid-20s, with readings as high as 24.6% in 2022 and more recent observations around 21–22%. Net profit margin has been the most variable metric: it reached the low 20s in 2021–2022, fell to 18.2% at 2023-12-31, recorded 22.5% at 2024-06-30, and declined to 14.0% in the latest available period.
Focusing on the most recent reported points, gross and operating margins are recorded at 44.0% and 21.7% as of the 2024-03-31 period end, while the most recent net profit margin is 14.0% as of 2025-12-31. The most recent Gross Margin was 44.0% (period end 2024-03-31), Operating Margin 21.7% (period end 2024-03-31), and Net Profit Margin 14.0% (period end 2025-12-31).
Understanding Profit Margins
Between Apr 2025 and Mar 2026, Idex Corp De converts every dollar of revenue through the following stages:
Sustainable competitive advantages reveal themselves through consistently superior profit margins over extended periods. Companies with durable economic moats maintain pricing power and operational efficiency that competitors struggle to match.
A sign of durable competitive advantage is earning sustained higher margins than competitors.Look for margins that remain stable or improve over time, especially during economic downturns. Declining margins may signal increasing competition, pricing pressure, or deteriorating business fundamentals.
Comparing reported earnings to actual cash generation
IDEX CORP /DE/’s trailing twelve-month net income rose from mid-decade lows (about $271.1M at 2016-12-31) through the late 2010s and climbed to a peak of $719.0M at 2024-06-30. Since that peak the TTM net income has declined through 2024-09-30 ($629.0M) and 2024-12-31 ($505.0M) to the most recent observation of $483.2M at 2025-12-31.
Operating cash flow (TTM) observations in the dataset show an upward path from $399.9M at 2016-12-31 to $528.1M at 2019-12-31 and $569.3M at 2020-12-31. On the dates where both metrics are available (2016-12-31 and 2019-12-31), operating cash flow exceeded net income; the latest reported net income (\$483.2M as of 2025-12-31) is lower than the most recent operating cash flow observation ($569.3M as of 2020-12-31).
Key Findings:
The most recent Net Income (TTM) was $483.2M (2025-12-31). The most recent Operating Cash Flow (TTM) observation was $569.3M (2020-12-31).
The Earnings vs. Cash Flow Gap
Reported earnings (Net Income) doesn't always reflect actual cash generation. Companies use accrual accounting, which recognizes revenue when earned and expenses when incurred—not when cash actually changes hands. This creates timing differences and opportunities for accounting discretion that can mask underlying business health.
Net Income (the "earnings" number) can be influenced by non-cash items like depreciation, stock-based compensation, and changes in accounting estimates.Operating Cash Flow, however, shows the actual cash the business generates from its core operations—a harder number to manipulate.
What to Look For
Key Insight: Companies with durable competitive advantages typically show operating cash flow that meets or exceeds net income over time, demonstrating they convert accounting profits into actual cash that can be returned to shareholders or reinvested in the business.
Measuring management's efficiency at generating profits from shareholder capital
IDEX CORP /DE/'s trailing twelve‑month ROE has moved lower in the most recent quarters. After a high of 24.6% at the metric declined to 16.8% at , ticked up to 19.7% at , and then fell to 12.0% at , the most recent period. The most recent change therefore represents a pronounced decline versus the mid‑2024 reading.
Looking further back, ROE for IDEX CORP /DE/ commonly sat in the high‑teens to low‑twenties across multiple years, with notable peaks in mid‑2016 (28.5% on and 26.8% on ) and a trough of 2.6% on . The most recent trailing twelve‑month ROE was 12.0% as of .
The Gold Standard of Profitability
Return on Equity (ROE) is a powerful measure of how effectively a company's management is using the money shareholders have invested. Calculated by dividing Net Income by Shareholders' Equity, it reveals how much profit is generated for every dollar of equity capital.
A consistently high ROE (typically above 15-20%) is often the signature of a "quality" business with a durable competitive advantage. It indicates that the company can generate high returns on its own capital, which it can then reinvest at these high rates to compound value over time.
What to Look For:
How the company generates and deploys its cash
Over the most recent trailing-twelve-month periods, IDEX CORP /DE/ shows a notable shift in financing cash flow: financing moved from a negative $-344.7M TTM in 2023 to a positive $465.9M TTM in 2024, then reversed sharply to a negative $-632.6M TTM in 2025, representing a material change in the company's cash flows from financing activities. Investing cash flow has remained negative across the period but the magnitude narrowed substantially in the latest TTM, from $-1.01B in 2024 to $-137.6M in 2025, indicating the largest recent inflection in investing outflows.
Operating cash flow in the dataset is only reported for the 2020 TTM at $569.3M; there are no later operating TTM entries in the provided data. The most recent observed values are: Operating Cash Flow (TTM) $569.3M (2020-12-31), Investing Cash Flow (TTM) $-137.6M (2025-12-31), Financing Cash Flow (TTM) $-632.6M (2025-12-31).
Understanding Company Strategy
Capital allocation refers to how management decides to spend and invest the company's cash. Analyzing the three primary categories of cash flow reveals a company's true operational strategy:
What to look for: Is the company bootstrapping (funding growth solely from operating cash)? Are they borrowing to fund aggressive expansion or dividends? Or are they capital raising by issuing new shares, potentially diluting your ownership? A healthy, mature company typically generates strong operating cash, moderately invests in growth, and returns the surplus to shareholders through financing activities.
Net assets attributable to each share — the accounting floor of intrinsic value
Why Book Value per Share Matters
Book value per share is the net worth of the company — total assets minus total liabilities — divided by shares outstanding (split-adjusted). It represents the theoretical liquidation value per share if every asset were sold and every liability repaid at balance-sheet carrying values. It is the accounting foundation upon which much of equity valuation is built.
A steadily rising book value per share is one of the most reliable signals of compounding wealth creation. It means the company is retaining earnings and building net worth faster than it is returning capital or eroding it. Warren Buffett famously tracked Berkshire Hathaway's book value per share for decades as his primary measure of intrinsic value growth.
Context is essential. Asset-heavy businesses (banks, manufacturers, utilities) should be judged by book value more directly than asset-light businesses (software, consumer brands), where intangible assets like intellectual property and customer loyalty may far exceed their balance-sheet carrying values. A company trading at a large premium to book value is not necessarily overvalued — it may simply possess competitive advantages that accounting rules do not capture. Conversely, a declining book value per share — especially over multiple years — is a serious warning sign of capital destruction.
How much of the company is financed by debt versus shareholders' equity
Reading the Debt-to-Equity Ratio
The debt-to-equity (D/E) ratio compares total financial debt to shareholders' equity. A ratio of 1.0 means the company has borrowed one dollar for every dollar of equity; a ratio of 2.0 means it has borrowed twice as much as it owns. Financial leverage amplifies both returns and risk: in good times, debt turbocharges equity returns; in bad times, it accelerates losses and can threaten solvency.
Trends matter more than a single number. A rising D/E ratio can mean the company is taking on debt to fund growth — potentially value-creating if returns exceed the cost of capital. But it can also mean equity is being eroded through losses or that the business is borrowing simply to sustain operations. A falling D/E ratio generally reflects strengthening financial health: earnings are being retained, debt maturities are being paid down, or both.
Industry norms vary enormously. Capital-intensive sectors (utilities, real estate, financials) routinely carry high D/E ratios that would be alarming in, say, a technology company. Always compare against sector peers. As a rough rule of thumb, a D/E above 2× in a cyclical business warrants careful scrutiny of interest coverage and refinancing risk.
Short-term liquidity — can the company cover its near-term obligations?
Liquidity: Can the Business Pay Its Bills?
The current ratio is calculated as current assets divided by current liabilities. A ratio of 1.5 means the company has $1.50 of short-term assets — cash, receivables, inventory — for every $1.00 of obligations due within the next twelve months. It is the most direct measure of near-term financial resilience: can the business meet its obligations without needing to raise new capital or sell long-term assets at a discount?
A ratio above 1.0 is generally healthy, meaning current assets exceed current liabilities. A ratio consistently above 2.0 may indicate the company is holding excess cash or inventory that could be deployed more productively. A ratio below 1.0 is a warning sign — the company is relying on future cash generation or external financing to cover its near-term obligations, which is manageable in normal conditions but dangerous during a downturn.
Trends and context matter.A declining current ratio isn't always alarming — highly efficient businesses (e.g., large retailers with reliable daily cash flows) often run leaner balance sheets intentionally. Conversely, a rapidly rising current ratio can signal slowing sales causing inventory to build, or customers taking longer to pay. Always compare the trend against industry peers and cross-reference with the cash flow statement to assess whether the business is genuinely liquid or just holding non-cash current assets.
How much the market is paying for each dollar of company earnings
IDEX CORP /DE/’s P/E has shown a clear rebound and partial pullback over the past 18 months. The ratio rose from 20.7x at to 31.5x at , then eased to 28.0x by , indicating a mid‑2024 trough followed by a late‑2024 re‑rating and a modest de‑rating through 2025. Recent quarters therefore show elevated valuation levels relative to mid‑2024 but slightly below the late‑2024 peak.
Viewed over a longer horizon, the P/E has oscillated—notably higher readings such as 39.9x at and an outlier 93.9x at —while several prior years sat in the low‑ to mid‑20s. The most recent Price-to-Earnings (P/E) ratio was 28.0x.
What Is the PE Ratio?
The Price-to-Earnings (PE) ratio is one of the most widely used valuation metrics in investing. It divides the current stock price by the company's earnings per share (EPS), revealing how much investors are willing to pay for each dollar of earnings. A high PE can signal that the market expects strong future growth, while a low PE may suggest undervaluation—or reflect genuine concerns about the company's prospects.
Context matters:PE ratios vary significantly across industries. High-growth technology companies routinely trade at PE ratios above 30x or 40x, while mature, low-growth sectors like utilities or financials often trade closer to 10–15x. Always compare a company's PE to its own history and its industry peers, not just an absolute number.
What to Look For:
Key Insight:The PE ratio is a snapshot of market sentiment and expectations. Tracking it over time alongside earnings trends reveals whether the market's valuation has expanded or contracted—and whether that change is justified by fundamentals.