IDEX Corp
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
$523.00 | Gdxzqc | Jdvnlfkjxb |
Idex Is a Cash Compounder With an Impressive Track Record of Capital Allocation and Margin Expansion
Business Strategy and Outlook
Idex owns a collection of moaty businesses that tend to be leaders in their respective niche end markets, typically holding the number one or two market share position. Idex manufactures a wide array of products, ranging from equipment used in DNA sequencing, through wastewater pumps, to Jaws of Life hydraulic rescue tools. Idex’s lean manufacturing prowess allows it to effectively operate in a high mix and low volume environment, offering customers a wide variety of highly engineered products that are configurable or customizable. Furthermore, a common theme across its businesses is that they specialize in making mission-critical equipment that performs a vital function but typically comprises a small part of the customer’s total bill of materials. This aspect of the business contributes to Idex’s narrow moat through customer switching costs and allows the firm to command premium pricing.