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IMI plc (LON:IMI), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the LSE. The recent jump in the share price has meant that the company is trading around its 52-week high. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today we will analyse the most recent data on IMI’s outlook and valuation to see if the opportunity still exists.

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Is IMI Still Cheap?

According to our valuation model, the stock is currently overvalued by about 25%, trading at UK£29.08 compared to our intrinsic value of £23.23. This means that the opportunity to buy IMI at a good price has disappeared! If you like the stock, you may want to keep an eye out for a potential price decline in the future. Since IMI’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Check out our latest analysis for IMI

Can we expect growth from IMI?LSE:IMI Earnings and Revenue Growth April 20th 2026

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by a double-digit 13% over the next couple of years, the outlook is positive for IMI. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? IMI’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? If you believe IMI should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on IMI for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for IMI, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

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So while earnings quality is important, it's equally important to consider the risks facing IMI at this point in time. You'd be interested to know, that we found 1 warning sign for IMI and you'll want to know about it.

If you are no longer interested in IMI, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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Haftungsausschluss: Der Text wurde mit Hilfe einer KI zusammengefasst und übersetzt. Für Aussagen aus dem Originaltext wird keine Haftung übernommen!

IMI logo

Key Points

IMI delivered a milestone 20% operating margin with organic revenue up 5% and adjusted operating profit of £460m, and announced a £500m share buyback alongside a proposed 10% final dividend increase. The company showed strong cash generation—£290m free cash flow and 96% cash conversion—returning £281m to shareholders, while net debt finished at £533m with net debt/EBITDA at about 1x. Operationally, Automation (notably Process Automation) and the aftermarket drove growth (aftermarket orders +11%), Transport declined 6% and is under strategic review, and management expects another year of mid-single digit organic growth with 2026 EPS guidance of £1.36–£1.42. Interested in IMI plc? Here are five stocks we like better.

IMI (LON:IMI) reported what management described as another year of “strong strategic and financial progress” in its 2025 full-year results presentation, extending a multi-year run of mid-single digit organic growth and reaching a new profitability milestone.

Chief executive Roy (who presented alongside CFO Luke Grant) said the company delivered its fifth consecutive year of mid-single digit organic revenue growth and achieved a 20% operating margin for the first time. Management also announced a new GBP 500 million share buyback and said it would propose a 10% increase to the final dividend, citing strong cash generation and confidence in the business.

2025 results: growth, margin milestone, and cash generation

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Grant said revenue increased 5% organically in 2025, while adjusted operating profit rose 8% organically. Adjusted operating profit was reported at GBP 460 million, and adjusted operating margin improved 30 basis points to 20%. Adjusted basic EPS increased 8% year-over-year to 132.3 pence.

Grant also highlighted that IMI’s margin has increased 580 basis points versus 2019, alongside what he described as record levels of investment across the business. Cash conversion was described as strong, with Roy later stating cash conversion was 96%.

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On the cash flow statement, IMI delivered free cash flow of GBP 290 million and returned GBP 281 million to shareholders via dividends and the existing share buyback program. Net debt ended the year at GBP 533 million, with net debt to EBITDA at 1 times, which management said was at the bottom of its target range.

Working capital was a particular focus in the discussion. Grant said the company delivered a GBP 3 million working capital inflow, supported by a GBP 31 million reduction in inventory, reflecting progress reducing safety stocks after the completion of a multi-year restructuring program in 2024. Grant added that the restructuring program’s completion means costs associated with the current business are now included in underlying results rather than treated as an adjusting item.

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Grant also said IMI completed the final buyout of its U.K. pension scheme, calling it an “important milestone” after a decade of work.

Platform performance: Automation led by Process, Climate Control steady, Transport down

In segment commentary, Grant said Automation delivered strong growth, with revenue up 8% organically. He described Process Automation as having “an excellent year,” including strong order intake. Adjusting for the planned disposal of Truflo Marine, Grant said Process Automation orders were up 5% organically, and he highlighted continued growth in the higher-margin aftermarket.

IMI’s aftermarket performance was emphasized repeatedly. Grant said that after a very strong fourth quarter, full-year aftermarket orders were 11% higher than 2024 (and 9% higher after adjusting for Truflo Marine), while the order book increased 2%.

In Industrial Automation, Grant described results as resilient amid uncertain markets, with organic revenue down 1% year-over-year.

Within Life Technology, organic revenue increased 1%. Grant said Climate Control revenue rose 5% organically, supported by demand for products that reduce building energy consumption and by a growing portfolio of “smart connected” products, including those supporting advanced data center cooling technologies. Life Science & Fluid Control was flat organically as the global life science device market began to stabilize.

Transport organic revenue declined 6%, which management said was in line with the global heavy-duty truck market. Grant said the strategic review of transport was progressing and that IMI continues to assess all strategic options, while also seeing opportunities to strengthen performance within the group.

Strategy and end-market drivers: energy, automation, healthcare, and the aftermarket

Roy reiterated that IMI has aligned its portfolio to three long-term megatrends—energy, automation, and healthcare—and emphasized the role of the aftermarket, which he said represents around 45% of IMI sales. He also pointed to IMI’s positioning in bespoke, high-value fluid and motion control systems, arguing that its products typically represent a small portion of total system cost while materially affecting customer outcomes, supporting pricing power and customer loyalty.

Energy-related demand featured heavily in management’s examples. Roy said order intake in the high-margin aftermarket was up 16% organically in conventional power, while new construction was up 32%, driven by electrification and the need for reliable energy to power data centers. He also said the nuclear market saw a resurgence, with aftermarket orders up 33% organically year-over-year, citing opportunities tied to plant life extensions.

On data centers, Roy said IMI more than doubled order intake for liquid cooling-related offerings to GBP 18 million in 2025, with a global pipeline that continues to expand.

Innovation under the “Growth Hub” model was another theme. Roy said the company generated a record GBP 206 million of orders through Growth Hub in 2025, up 38% from 2024. He also said IMI is adopting artificial intelligence tools across the business, with more than 2,000 colleagues completing AI training, and reported productivity has increased 31% since 2019.

Guidance and outlook: mid-single digit organic growth expected again in 2026

Management said it expects a sixth consecutive year of mid-single digit organic growth in 2026. Based on current market conditions, IMI guided to full-year adjusted basic EPS of GBP 1.36 to GBP 1.42.

Grant outlined key assumptions behind the outlook:

Process Automation expected to grow mid- to high-single digits, supported by a “record order book.” Industrial Automation expected to be resilient, with organic revenue flat to modestly higher. Climate Control expected to see continued good demand; Life Science & Fluid Control expected to be stable with some growth in Life Science. Transport expected to be broadly flat, in line with the global heavy-duty truck market. Adjusted operating margin expected to be flat to slightly up, with operating leverage offsetting previously communicated cybersecurity investments.

The 2026 guidance assumes the disposal of Truflo Marine completes in mid-2026, a net interest charge of GBP 20 million, a tax rate of 26.3%, and a weighted average share count of 238 million following the GBP 500 million buyback. Management said foreign exchange rates are not currently expected to have a material impact on sales or profits.

Q&A: Process Automation momentum, pricing, geopolitics, and capital allocation

During Q&A, management provided additional color on late-year order momentum in Process Automation. Roy said Q4 Process Automation orders were up 26%, driven by 36% growth in new construction (including a “big” U.K. nuclear order for strainers) and 20% aftermarket growth in the quarter. He also reiterated that, excluding Truflo Marine, Process Automation orders were up 5% for the full year, with new construction flat and aftermarket up 9%.

On power demand, Roy said Process Automation’s power segment delivered just under GBP 300 million of orders in 2025, with 75% in aftermarket, and said the segment was up 20% year-over-year. He discussed lead times, noting that historically IMI saw about a six-month lag between OEM demand and IMI orders, but suggested this could extend given OEMs now have multi-year order books.

Asked about pricing, Roy said new construction margins were “reasonable” and slightly above last year, but that there had not yet been a major move. More broadly across IMI, Roy said pricing versus volume was “about half and half” in 2025, and he expected a similar mix in 2026, while noting IMI’s track record of passing through inflation due to its critical components representing a small portion of total system cost.

On geopolitical risk and oil and gas exposure, Roy said LNG orders were about GBP 100 million in 2025 (with roughly 40% aftermarket), while broader upstream and midstream oil and gas was about GBP 130 million (also about 40% aftermarket). He said the Middle East represents around 6% of IMI sales and noted the company had implemented security protocols and was in touch with around 60 people in the region. He cautioned about potential short-term volatility but said IMI was “happy” with its guidance while monitoring developments.

On capital allocation and M&A, Roy said IMI’s pipeline remains strong but emphasized discipline, stating the company walked away from several opportunities and would not overpay. Grant said IMI has deployed more than GBP 400 million in bolt-on acquisitions since 2019 and increased fully burdened ROIC by 260 basis points to 14%. He highlighted the integration of TWTG, a sensor solutions provider acquired for EUR 25 million in October 2024, which management said expands IMI’s asset monitoring offering and supports aftermarket growth ambitions.

IMI closed the call by reiterating its expectation for another year of progress and continued mid-single digit organic growth, supported by the company’s end-market positioning, aftermarket focus, and ongoing investment—including stepped-up cybersecurity spending that management said would become a new run-rate level following 2026.

About IMI (LON:IMI)

IMI plc is a specialist engineering company operating in fluid and motion control markets. We combine our deep engineering knowledge with strong applications expertise to develop solutions for the most acute industry problems. We help our customers become safer, more sustainable and more productive. IMI employs around 10,000 people, has manufacturing facilities in 19 countries and operates a global service network. The Company is listed on the London Stock Exchange and is a constituent of the FTSE4Good Index.

The article "IMI Q4 Earnings Call Highlights" was originally published by MarketBeat.

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Haftungsausschluss: Der Text wurde mit Hilfe einer KI zusammengefasst und übersetzt. Für Aussagen aus dem Originaltext wird keine Haftung übernommen!

Zusammenfassung (Maximal 450 Wörter):

Fairbanks Morse Defense (FMD), ein Portfolio-Unternehmen von Arcline Investment Management, hat seine Fähigkeiten und seine globale Reichweite durch die Übernahme von Truflo Marine, einem auf fortgeschrittene Ventildesign und -steuerungslösungen für Marineanwendungen spezialisierten Unternehmen mit Sitz in Birmingham, UK, erheblich erweitert. Diese strategische Maßnahme, die im November 2025 abgeschlossen wurde, stärkt FMDs Engineering- und Fertigungskompetenzen und verbessert seine Fähigkeit, alliierte Marinekräfte weltweit zu unterstützen.

Truflo Marine, ein anerkannter Marktführer mit jahrzehntelanger Erfahrung, verfügt über ein robustes Portfolio an geistigem Eigentum und Hochleistungsventildesigns, die in mehr als 34 Marinekräften weltweit eingesetzt werden. Die Übernahme umfasst die Truflo-Anlage in Birmingham, UK, und etwa 270 Mitarbeiter, was FMDs operativen Fußabdruck erheblich erweitert.

Steve Pykett, CEO von FMD, betonte die strategische Bedeutung der Übernahme: „Das Hinzufügen der fortschrittlichen Ventileigenschaften von Truflo Marine zu unserem Portfolio ermöglicht es uns, die besten Lösungen für unsere Kunden bereitzustellen.“ Die kombinierte Einheit wird sich auf die Bereitstellung integrierter Ventillösungen konzentrieren, die auf die sich entwickelnden Bedürfnisse moderner Marinekräfte zugeschnitten sind, wobei der Schwerpunkt insbesondere auf Einsatzbereitschaft liegt.

Diese Erweiterung gilt als eine weitere wichtige Investition von FMD, um seine internationalen und inländischen Fähigkeiten zu stärken. Durch die Nutzung der Designexpertise von Truflo in Kombination mit FMDs etabliertem Fertigungs- und Service-Netzwerk zielt das Unternehmen darauf ab, umfassende Lösungen zu liefern, die für die Aufrechterhaltung der Integrität und Überlebensfähigkeit von U-Booten und ihren Besatzungsmitgliedern entscheidend sind.

Die Expansion wird als ein weiterer wichtiger Schritt für FMD angesehen, um seine Führungsposition auf dem Marineanlagenmarkt zu festigen.

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