Franklin Electric carries an exceptionally strong balance sheet — maximum financial health scores, a current ratio of 9.0, and low leverage — and has beaten estimates in three of the last four quarters; however, the Water Systems segment accounts for roughly 60% of revenue concentrating both revenue and supplier risk in a single area, the stock has risen above its analyst take-profit target leaving no upside buffer, and free cash flow is running at only about 59% of net income, below what a high-quality earnings profile would typically imply.
Thesis pillars
- Exceptional Balance Sheet Financial Health→Stable
- Water Systems Segment Revenue Concentration→Stable
- Earnings Mostly Positive Beat Record→Stable
- +1 more pillar — see the Why tab for full reasoning
Franklin Electric Co., Inc. (FELE) Stock Analysis
Breakout setup · Catalyst-Driven edge
Industrials · Specialty Industrial Machinery
Sell if holding. At $105.14, A.R:R is negative (-1.1) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Product: Water Systems segment (60.0%); Concentration risk — Supplier: single or limited number of suppliers.
Franklin Electric Co. designs, manufactures and distributes water and fuel pumping systems across three segments — Water Systems (~60% of revenue), Energy Systems, and Distribution — generating approximately $2.1 billion in 2025 revenue. Products are sold worldwide to specialty... Read more
Sell if holding. At $105.14, A.R:R is negative (-1.1) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Product: Water Systems segment (60.0%); Concentration risk — Supplier: single or limited number of suppliers. Chart setup: Golden cross, above all MAs, RSI 59, MACD bullish. Score 5.1/10, moderate confidence.
Passes 7/9 gates (positive momentum, clean insider activity, no SEC red flags, news events none recent, earnings proximity 24d clear, semi cycle peak clear, materials cycle peak clear). Fails on favorable risk/reward ratio. Suitability: aggressive.
About Franklin Electric Co., Inc.
About Franklin Electric Co., Inc.
Water Systems generated approximately 60 percent of Franklin Electric's $2.1 billion 2025 revenue, with Energy Systems and Distribution comprising the remainder. The company held a consolidated order backlog of $139.1 million at February 4, 2026, with Water Systems alone accounting for $99.0 million. Franklin Electric employed approximately 6,500 people at December 31, 2025 and maintains named international operations across Europe, South Africa, Brazil, Mexico, India, China, Turkey, Canada, and Argentina.
Franklin Electric sells through employee sales forces and independent manufacturing representatives to specialty distributors, OEMs, industrial and petroleum equipment distributors, and major oil and utility companies. Water Systems serves residential, agricultural, municipal, and industrial groundwater and wastewater pumping applications; Energy Systems covers fuel containment, piping, vapor recovery, and electronic monitoring between the tank and the dispenser. The Distribution segment operates the Headwater Companies, serving professional water well contractors within the U.S. Principal raw materials include coil and bar steel, stainless steel, copper wire, and aluminum ingot, most available from multiple sources. Named competitors in specialty water products are Grundfos Management A/S, Pentair, Inc., and Xylem, Inc.; in petroleum equipment, Vontier Corporation and Dover Corporation. Water Systems also generates approximately 25 to 30 percent of segment revenue in developing markets, where the absence of municipal water infrastructure may support long-run volume growth.
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Supply chain exposure is disclosed explicitly in both the Business and Risk Factors sections. The 10-K acknowledges dependence on a single or limited number of suppliers for certain materials and components, with no alternative sourcing plan disclosed. Compounding this, the U.S. government implemented tariffs on imported steel and aluminum — two principal raw materials — and the filing notes potential retaliatory tariff escalation. The company does not engage in commodity hedging, meaning margin exposure to raw material cost swings passes directly to operating results if customers cannot absorb price increases.
See also: Industrials · Specialty Industrial Machinery
From Franklin Electric Co., Inc.'s most recent 10-K filing, extracted June 10, 2026.
Recent developments
updated 2026-07-06Recent Developments — Franklin Electric Co., Inc.
Latest news
- NEWS Franklin (FELE) In-Depth Look | Franklin posts 3.5% EPS miss on margin pressure - Shared Trade Ideas - Xã Vĩnh Công — Xã Vĩnh Công negative
- NEWS Franklin Electric to Participate in Upcoming Investor Conferences - marketscreener.com — marketscreener.com positive
- NEWS Franklin Electric (FELE) Projected to Post Earnings on Tuesday - MarketBeat — MarketBeat neutral
- NEWS Earnings Preview: FELE to Report Financial Results Pre-market on April 28 - 富途牛牛 — 富途牛牛 neutral
- NEWS Transcript: Franklin Electric Q1 2026 Earnings Conference Call — benzinga Apr 28, 2026 positive
Generated 2026-07-06T04:40:26Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHProductWater Systems segment60%10-K Item 1: 'Water Systems contributed about 60 percent of the Company's total revenue in 2025'
- HIGHSuppliersingle or limited number of suppliers10-K Item 1A: 'The Company is dependent on a single or limited number of suppliers for some materials or components required in the manufacture of its products'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
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Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. At $105.14, A.R:R is negative (-1.1) — price has exceeded the analyst target. Reward from here is too thin for a buy — the engine flags exit. Additional concerns: Concentration risk — Product: Water Systems segment (60.0%); Concentration risk — Supplier: single or limited number of suppliers. Chart setup: Golden cross, above all MAs, RSI 59, MACD bullish. Prior stop was $100.24. Score 5.1/10, moderate confidence.
Take-profit target: $107.13 (+1.9% upside). Prior stop was $100.24. Stop-loss: $100.24.
Concentration risk — Product: Water Systems segment (60.0%); Concentration risk — Supplier: single or limited number of suppliers; Analyst target reached - limited upside remaining.
Franklin Electric Co., Inc. trades at a P/E of 31.8 (forward 20.7). TrendMatrix value score: 5.2/10. Verdict: Sell.
11 analysts cover FELE with a consensus score of 3.9/5. Average price target: $113.
What does Franklin Electric Co., Inc. do?Franklin Electric Co. designs, manufactures and distributes water and fuel pumping systems across three segments —...
Franklin Electric Co. designs, manufactures and distributes water and fuel pumping systems across three segments — Water Systems (~60% of revenue), Energy Systems, and Distribution — generating approximately $2.1 billion in 2025 revenue. Products are sold worldwide to specialty distributors, OEMs, and petroleum equipment distributors through an employee sales force and independent representatives, with roughly 6,500 employees at December 31, 2025.