Paradice Investment Management opens a new $18 million position in Flowserve (NYSE: FLS ) | Colorful fool
Paradice Investment Management LLC started a new position in Flowserve Corporation (FLS +1.76%) during the third quarter acquiring 338,154 shares with an estimated value of $17.97 million as of 09/30/2025, according to an SEC filing on October 20, 2025.
What happened
Paradice Investment Management LLC disclosed in a filing with the Securities and Exchange Commission on October 20, 2025 that it started a new stake in Flowserve Corporation during the third quarter.
The fund reported ownership of 338,154 shares worth $17.97 million as of September 30, 2025 based on its Form 13F filing.
No previous position was listed in the previous quarter’s filing.
What else to know
This represents a new fund position representing 4.03% of Paradice’s reported US shares as of September 30, 2025.
Top five businesses after filing:
- Globus Medical: $37.97 million (8.5% of AUM) as of September 30, 2025
- Envista: $36.81 million (8.3% of AUM) as of September 30, 2025
- Lear: $32.28 million (7.24% of AUM) as of September 30, 2025
- Mohawk Industries: $30.58 million (6.86% of AUM) as of September 30, 2025
- Generation: USD 30.35 million (6.8% of AUM) as of September 30, 2025
As of October 20, 2025, Flowserve stock was valued at $51.23, underperforming the S&P 500 by 20 percentage points over the same period.
Company overview
| Metric | Value |
|---|---|
| Sales (TTM) | $4.65 trillion |
| Net Income (TTM) | $291.58 million |
| Dividend yield | 1.6% |
Company snapshot
Flowserve designs, manufactures and services industrial flow control equipment, including pumps, valves, mechanical seals and automation solutions.
It generates revenue through equipment sales, after-sales services and maintenance solutions in two main divisions: Flowserve Pump Division and Flow Control Division.
The company serves customers in oil and gas, chemicals, power generation, water management and diversified industries worldwide.
Flowserve Corporation operates in the field of industrial flow control and offers a diverse portfolio of engineered products and after-sales services.
The company uses its extensive expertise and global reach to provide critical solutions for complex fluid motion and control applications.
The company focuses on after sales services and maintains a broad exposure to the end market in the industrial machinery sector.
Foolish to take
Paradice’s purchase of Flowserve is a remarkable investment on several fronts.
First, Flowserve immediately becomes Paradice’s 12th largest position with 4% of the firm’s portfolio. This is a strong opening position for the stock.
Second, the purchase is interesting because Flowserve and Graf Industries (GTLS 0.05%) they had just agreed to a “merger of equals” that would combine their complementary businesses.
With a very similar customer base, the deal could make a lot of sense and generate a number of synergies. Management believes in cost savings of $300 million a year, to be exact.
That’s a hefty number considering the company’s combined earnings before interest, taxes, depreciation and amortization (EBITDA) is currently $1.6 billion.
While Flowserve helps with all things pump and flow control, Chart brings expertise in thermal management and offers cryogenic and compression products.
Paradice seems interested in the opportunity and believes there is some value in this merger.
Management expects the combined company to have an enterprise value of roughly $19 billion with adjusted EBITDA of $1.9 billion, so it would trade at only about 10 times adjusted EBITDA.
That’s not a bad price for a company poised to emerge as a leader in its niche after the merger — and Paradice is betting big on this potential merger and the cross-selling potential that comes with it.
Glossary
13F filing: A quarterly report required by the SEC from institutional investment managers detailing their stock holdings.
Assets under management (AUM): The total market value of investments managed on behalf of clients by a fund or firm.
Dividend yield: A financial ratio showing how much a company pays out in dividends each year relative to its share price.
After sales services: Support, maintenance and parts provided for products after the first sale.
Last twelve months (TTM): 12-month period ending with the most recent quarterly report.
Bet: The amount of ownership or investment that a fund or individual holds in a company.
Industrial flow control: Management and movement of liquids and gases in industrial processes using specialized equipment.
End market exposure: The range of industries or sectors to which the company operates with its products or services.
Mechanical seal: Devices used to prevent leakage where a rotating shaft passes through a stationary housing in machinery.
Market value: The current total value of the investment or holding based on the latest market price.