Enpro’s second quarter was marked by positive momentum, with the market responding favorably to the company’s 6% year-on-year revenue growth, driven primarily by robust performance in Advanced Surface Technologies (AST) and steady gains in Sealing Technologies. Management attributed the quarter’s top-line growth to a 14.5% increase in AST, supported by demand for precision cleaning solutions and optical coatings, as well as strength in aerospace and food and pharma markets within Sealing. CEO Eric Vaillancourt highlighted, “We continue to identify opportunities for incremental growth throughout the Sealing Technologies segment and are focused on expanding our market reach by leveraging our differentiated technological capabilities.”
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Enpro (NPO) Q2 CY2025 Highlights:
- Revenue: $288.1 million vs analyst estimates of $282.6 million (6% year-on-year growth, 1.9% beat)
- Adjusted EPS: $2.03 vs analyst expectations of $2.10 (3.2% miss)
- Adjusted EBITDA: $71.1 million vs analyst estimates of $73.9 million (24.7% margin, 3.8% miss)
- The company lifted its revenue guidance for the full year to $0.06 at the midpoint from $0.04, a 60% increase
- Management raised its full-year Adjusted EPS guidance to $7.85 at the midpoint, a 6.8% increase
- EBITDA guidance for the full year is $275 million at the midpoint, above analyst estimates of $268.1 million
- Operating Margin: 15.7%, down from 17.7% in the same quarter last year
- Market Capitalization: $4.79 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 Enpro’s Q2 Earnings Call
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Jeffrey David Hammond (KeyBanc Capital Markets) asked about the transactional FX headwind in Sealing. CFO Joseph Bruderek explained that FX impacts were tied to nonfunctional currency expenses, particularly in Taiwan, and clarified the magnitude for both segments this quarter.
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Hammond also questioned incremental margins in AST for the second half. Bruderek replied that the FX impact is expected to lessen, and that growth investments should leverage better as revenue from recent capacity additions matures.
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Hammond inquired about drivers behind improved Sealing growth in the second half. CEO Eric Vaillancourt pointed to new program wins in commercial truck OEMs and expanding opportunities in space markets.
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Stephen Michael Ferazani (Sidoti & Company) probed the pace of AST’s growth and the impact of new investments. Vaillancourt noted that while some facilities remain in the qualification phase, early benefits are emerging and are expected to accelerate.
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Ferazani also questioned the success of the compositional analysis business post-AMI acquisition. Vaillancourt called the segment “outstanding,” with capacity expansions underway to meet demand.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will watch (1) the pace at which new capacity investments in AST and Sealing begin generating incremental revenue, (2) the effectiveness of strategic pricing and cost discipline in offsetting margin pressures, and (3) management’s ability to navigate lingering foreign exchange headwinds. Developments in end-market demand, especially in aerospace, semiconductor, and compositional analysis, will also be critical signposts.
Enpro currently trades at $227.45, up from $214.98 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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