HLIO Stock Forecast & Price Target

Helios Technologies Inc. is experiencing growth driven by the stabilization and improvement of its key end markets, with multiple businesses reporting increased orders for several months. The company's performance is further bolstered by positive developments in its distribution-based business, which is expected to enhance revenue as market recovery momentum builds through 2026. Additionally, the emergence of self-help initiatives under new leadership is instilling confidence in the company's potential for earnings momentum in the second half of 2025.

Helios Technologies' stock outlook is negatively affected by its heavy reliance on the Hydraulics segment, which is linked to cyclical end markets that can result in decreased sales growth during economic downturns. Although the company anticipates the potential for significant growth within its existing capacity, the inherent vulnerabilities associated with cyclical markets pose a persistent risk. Furthermore, despite expectations of strong incremental margins and low growth capital expenditure needs, the volatility of the markets it serves raises concerns about sustained performance and stability.