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Spirax Group
(LSE:SPX)
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Rating:67Neutral
Price Target:
8,300.00 p
▲(17.23% Upside)
Action:Reiterated
Date:08/11/26
The score is driven primarily by a mixed financial backdrop (multi-year margin compression and higher leverage despite positive cash generation). Technicals add support with a strong uptrend, though overbought signals increase near-term risk. Valuation is a headwind due to a high P/E, while the latest earnings call was constructive with reiterated guidance, improving margins/ROCE, and expectations for stronger H2 cash conversion and leverage improvement.
Positive Factors
Diversified, recurring revenue model
Spirax's mix of engineered product sales plus recurring aftermarket spares, consumables and services creates durable revenue streams and customer lock‑in. The installed base across steam, pumps and electric heating supports predictable repeat demand and long‑term cash visibility.
Negative Factors
Multi‑year margin compression
A sustained decline in net and EBIT margins over several years signals structural pressure from rising costs, mix shifts or weaker pricing power. If persistent, this erodes return on equity and the company's ability to fund reinvestment or absorb macro shocks, limiting long‑term upside.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified, recurring revenue model
Spirax's mix of engineered product sales plus recurring aftermarket spares, consumables and services creates durable revenue streams and customer lock‑in. The installed base across steam, pumps and electric heating supports predictable repeat demand and long‑term cash visibility.
Read all positive factors
Spirax Group (SPX) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£5.32B
Dividend Yield2.38%
Average Volume (3M)169.83K
Price to Earnings (P/E)32.3
Beta (1Y)1.37
Revenue Growth5.07%
EPS Growth21.70%
CountryUK
Employees10,072
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)2.21
Shares Outstanding73,826,050
10 Day Avg. Volume195,337
30 Day Avg. Volume169,833
Financial Highlights & Ratios
PEG Ratio-2.15
Price to Book (P/B)4.11
Price to Sales (P/S)2.95
P/FCF Ratio23.73
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
£8,410.00Price Target Upside18.79% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)3.22
Revenue Forecast (FY)£1.78B
Spirax Group Business Overview & Revenue Model
Company Description
Spirax-Sarco Engineering plc, founded in 1888 and headquartered in Cheltenham, UK, delivers sophisticated engineered solutions across several core technological domains. The company specializes in comprehensive industrial and commercial steam syst...
How the Company Makes Money
Spirax Group makes money primarily by selling engineered industrial products and systems, and by generating recurring aftermarket revenue from spares, consumables, service, and maintenance tied to its installed base.
1) Product and systems sales ...
Spirax Group Earnings Call Summary
Earnings Call Date:Aug 11, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Mar 11, 2027
Earnings Call Sentiment Positive
The call presents a broadly positive performance: the group delivered mid‑single‑digit organic sales and profit growth, with notable margin progression in ETS and Watson‑Marlow, improved ROCE, strong order books, and reiterated medium‑term targets. Short‑term headwinds include STS margin phasing, inventory builds for geopolitical risk (reducing H1 cash conversion), temporary leverage slightly above the target range, and exposure to weak industrial production and FX movements. Management highlighted concrete operational and commercial initiatives (digital connections, decarbonization, localized production, and sales reinvestment) that support confidence in delivering full‑year guidance and medium‑term targets. Overall, the positive execution and pipeline momentum outweigh the transitory challenges communicated.Positive Updates
Organic Sales Growth Outperforming Industrial Production
Group organic sales grew 5% in H1, well ahead of Industrial Production (IP) at 1.5%, demonstrating demand generation and market outperformance across all three businesses.
Negative Updates
STS Margin and Operating Profit Pressure in H1
STS adjusted operating profit declined 6% organically in H1 and adjusted operating margin fell c.170 basis points to 22%, largely due to shipment phasing (customers specifying H2 deliveries) and first‑half weighted investments in sales headcount and digital capabilities.
Read all updates
Q2-2026 Updates
Positive
Negative
Organic Sales Growth Outperforming Industrial Production
Group organic sales grew 5% in H1, well ahead of Industrial Production (IP) at 1.5%, demonstrating demand generation and market outperformance across all three businesses.
Read all positive updates
Company Guidance
Management reiterated full‑year guidance and said the group is on track, expecting higher H2 volumes and margin progression (typical adjusted operating profit weighting c.45% H1 / 55% H2). Key metrics: H1 organic sales +5% (vs IP +1.5%), organic operating profit +6%, adjusted operating margin 19.8% (up 10bps organically), adjusted EPS +9% to 150p, adjusted cash from operations £92m (H1 cash conversion 54%; full‑year cash conversion expected ~90%), H1 CapEx ~3% of sales with full‑year CapEx to be at the lower end of the 4–5% guidance, net debt £618m (net debt/EBITDA 1.6x; target 1.0–1.5x by year‑end), and ROCE >35% (up 180bps). Division outlooks: STS H1 sales +1% with stronger H2 and medium‑term margin target 23.5%; ETS H1 sales +11% with margin 17.2% (up 220bps) and a 20% margin target; Watson‑Marlow H1 sales +7% with margin 27.5% (up 80bps) and a path to >30%. FX assumed to have negligible full‑year revenue/profit impact (H1 profit had ~+2% FX tailwind; expect ~-2% H2 headwind).Spirax Group Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
60
Neutral
Cash Flow
64
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.70B | 1.67B | 1.68B | 1.61B | 1.34B |
| Gross Profit | 539.70M | 333.90M | 1.28B | 576.70M | 492.30M |
| EBITDA | 399.40M | 378.30M | 390.60M | 402.10M | 392.00M |
| Net Income | 163.40M | 191.20M | 183.60M | 224.70M | 234.60M |
Balance Sheet | |||||
| Total Assets | 2.66B | 2.65B | 2.71B | 2.78B | 1.86B |
| Cash, Cash Equivalents and Short-Term Investments | 369.00M | 334.20M | 359.70M | 328.90M | 274.60M |
| Total Debt | 1.02B | 1.03B | 1.12B | 1.08B | 465.20M |
| Total Liabilities | 1.44B | 1.44B | 1.55B | 1.62B | 853.20M |
| Stockholders Equity | 1.22B | 1.21B | 1.16B | 1.17B | 1.01B |
Cash Flow | |||||
| Free Cash Flow | 211.80M | 238.50M | 193.20M | 113.70M | 204.20M |
| Operating Cash Flow | 259.60M | 312.80M | 298.60M | 231.20M | 268.30M |
| Investing Cash Flow | -75.30M | -65.30M | -95.70M | -576.60M | -62.10M |
| Financing Cash Flow | -178.00M | -215.00M | -219.20M | 362.20M | -204.80M |
Spirax Group Technical Analysis
Positive
7080.00
Price Trends
6910.20
Positive
6975.67
Positive
6989.78
Positive
Market Momentum
145.59
Negative
54.65
Neutral
65.04
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SPX, the sentiment is Positive. The current price of 7080 is below the 20-day moving average (MA) of 7113.00, above the 50-day MA of 6910.20, and above the 200-day MA of 6989.78, indicating a bullish trend. The MACD of 145.59 indicates Negative momentum. The RSI at 54.65 is Neutral, neither overbought nor oversold. The STOCH value of 65.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:SPX.
Spirax Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | £7.47B | 22.54 | 32.41% | 1.12% | 7.67% | 45.97% | |
76 Outperform | £3.97B | 32.49 | 20.10% | 1.70% | 2.22% | 25.89% | |
69 Neutral | £7.73B | 33.92 | 13.71% | 1.75% | -31.27% | -13.26% | |
67 Neutral | £5.32B | 32.29 | 13.86% | 2.40% | 5.07% | 21.70% | |
67 Neutral | £1.54B | 26.76 | 9.30% | 3.30% | 1.68% | 111.96% | |
65 Neutral | £7.12B | 26.10 | 13.45% | 1.59% | 5.84% | -14.62% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
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Spirax Group Corporate Events
Business Operations and StrategyFinancial Disclosures
Spirax Group Delivers H1 Growth Ahead of Industrial Production and Reaffirms 2026 Outlook
Positive
Aug 11, 2026
Spirax Group reported resilient first‑half 2026 results, with group revenue rising 5% year on year to £863.8m and organic sales growth comfortably ahead of global industrial production. Adjusted operating profit increased 8% to £17...
Regulatory Filings and Compliance
Spirax Group Discloses Routine Executive Share Incentive Transactions
Neutral
Aug 7, 2026
Spirax Group plc has disclosed a series of routine share transactions by senior executives under its Share Incentive Plan, in line with UK Market Abuse Regulation requirements. The transactions involve modest acquisitions of partnership shares, ma...
Regulatory Filings and Compliance
Spirax Group Reports Routine Executive Share Incentive Transactions
Neutral
Jul 8, 2026
Spirax Group plc, listed in London, maintains a corporate structure headed by Group Chief Executive Nimesh Patel, supported by a Group HR Director and divisional managing directors. Its equity-based compensation framework emphasises share particip...
Regulatory Filings and Compliance
Spirax Group updates investors on latest block listing share utilisation
Neutral
Jun 18, 2026
Spirax Group reported its latest six-monthly block listing return for ordinary shares, covering the period from 19 December 2025 to 18 June 2026, in line with UK listing rules. During the period, the company allotted 50,000 shares under its existi...
Executive/Board ChangesRegulatory Filings and Compliance
Spirax Group Discloses Routine Executive Share Incentive Plan Awards
Positive
Jun 8, 2026
Spirax Group plc has reported routine share transactions by several senior executives under its employee Share Incentive Plan, in line with UK Market Abuse Regulation disclosure requirements. Group CEO Nimesh Patel acquired three partnership share...
Business Operations and StrategyExecutive/Board Changes
Spirax Group NED Constance Baroudel to Become CEO of Spectris Limited While Remaining on Board
Positive
May 29, 2026
Spirax Group plc has announced that non-executive director Constance Baroudel will leave her role at Halma plc in August 2026 to become chief executive officer of Spectris Limited from 1 September 2026, while retaining her non-executive position o...
DividendsRegulatory Filings and Compliance
Spirax Group Executives Receive Shares Through Dividend Reinvestment Plan
Neutral
May 27, 2026
Spirax Group has disclosed routine share transactions under its dividend reinvestment plan following payment of the final dividend in May 2026. The disclosures, made under UK Market Abuse Regulation, relate to awards of ordinary shares to senior e...
DividendsRegulatory Filings and Compliance
Spirax Group Reports DRIP Share Awards to Senior Executives
Neutral
May 26, 2026
Spirax Group plc has disclosed a series of routine dividend reinvestment plan transactions involving senior executives following the payment of its final dividend in May 2026. Group CEO Nimesh Patel, Group HR Director Jim Devine and ETS Managing D...
Business Operations and StrategyExecutive/Board Changes
Spirax Group Chair Takes Additional Role at Coats Group
Positive
May 14, 2026
Spirax Group has detailed that its chair, Tim Cobbold, will join the board of Coats Group as a non-executive director and chair designate from 1 July 2026, becoming chair of Coats on 1 August while retaining his current role at Spirax. The move un...
Executive/Board ChangesRegulatory Filings and ComplianceShareholder Meetings
Spirax Grants Additional Performance Shares to CEO and CFO After Policy Approval
Neutral
May 14, 2026
Spirax Group has confirmed additional performance share awards to senior executives under its 2023 Performance Share Plan, following shareholder approval of an updated remuneration policy and share award rules at the 2026 AGM. Group CEO Nimesh Pat...
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Spirax Group Wins Strong Shareholder Backing at AGM as Board Change Confirmed
Positive
May 13, 2026
Spirax Group reported that all resolutions put to shareholders at its annual general meeting were approved by poll, with participation representing more than 83% of the total voting capital. The strong backing covered both ordinary and special res...
Business Operations and StrategyDividendsFinancial Disclosures
Spirax Group Delivers Solid Early‑2026 Growth and Reaffirms Full‑Year Guidance
Positive
May 13, 2026
Spirax Group reported that trading in the first four months of 2026 delivered mid‑single‑digit organic revenue growth and an improved adjusted operating margin, despite a weak global industrial production backdrop and ongoing macroecon...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.