NYSE:CR

Stock Analysis Report

Executive Summary

Crane Co. manufactures and sells engineered industrial products in the United States and internationally.

Rewards

Trading at 64.6% below its fair value

Earnings are forecast to grow 48.98% per year

Pays a high and reliable dividend of 3.53%

Risk Analysis

Has a high level of debt

Highly volatile share price over past 3 months

Large one-off items impacting financial results

Profit margins (4.1%) are lower than last year (10%)



Snowflake Analysis

Established dividend payer with reasonable growth potential.


Similar Companies

Share Price & News

How has Crane's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CR's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-0.7%

CR

-1.2%

US Machinery

-2.6%

US Market


1 Year Return

-43.3%

CR

-23.5%

US Machinery

-13.3%

US Market

Return vs Industry: CR underperformed the US Machinery industry which returned -23.5% over the past year.

Return vs Market: CR underperformed the US Market which returned -13.3% over the past year.


Shareholder returns

CRIndustryMarket
7 Day-0.7%-1.2%-2.6%
30 Day-25.1%-17.4%-15.2%
90 Day-43.7%-29.7%-22.2%
1 Year-42.1%-43.3%-21.3%-23.5%-11.5%-13.3%
3 Year-32.1%-35.6%-1.8%-8.9%13.2%5.7%
5 Year-13.3%-21.5%21.1%5.7%31.8%17.2%

Price Volatility Vs. Market

How volatile is Crane's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Crane undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CR ($48.72) is trading below our estimate of fair value ($137.57)

Significantly Below Fair Value: CR is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CR is poor value based on its PE Ratio (21.9x) compared to the Machinery industry average (15.2x).

PE vs Market: CR is poor value based on its PE Ratio (21.9x) compared to the US market (12.5x).


Price to Earnings Growth Ratio

PEG Ratio: CR is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: CR is overvalued based on its PB Ratio (2x) compared to the US Machinery industry average (1.6x).


Next Steps

Future Growth

How is Crane forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

49.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CR's forecast earnings growth (49% per year) is above the savings rate (1.7%).

Earnings vs Market: CR's earnings (49% per year) are forecast to grow faster than the US market (13.4% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: CR's revenue (2.5% per year) is forecast to grow slower than the US market (7% per year).

High Growth Revenue: CR's revenue (2.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CR's Return on Equity is forecast to be high in 3 years time (24.1%)


Next Steps

Past Performance

How has Crane performed over the past 5 years?

7.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CR has a large one-off loss of $250.6M impacting its December 31 2019 financial results.

Growing Profit Margin: CR's current net profit margins (4.1%) are lower than last year (10%).


Past Earnings Growth Analysis

Earnings Trend: CR's earnings have grown by 7.5% per year over the past 5 years.

Accelerating Growth: CR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: CR had negative earnings growth (-60.3%) over the past year, making it difficult to compare to the Machinery industry average (-1.6%).


Return on Equity

High ROE: CR's Return on Equity (9%) is considered low.


Next Steps

Financial Health

How is Crane's financial position?


Financial Position Analysis

Short Term Liabilities: CR's short term assets ($1.5B) exceed its short term liabilities ($916.7M).

Long Term Liabilities: CR's short term assets ($1.5B) do not cover its long term liabilities ($2.0B).


Debt to Equity History and Analysis

Debt Level: CR's debt to equity ratio (67.2%) is considered high.

Reducing Debt: CR's debt to equity ratio has reduced from 79.5% to 67.2% over the past 5 years.

Debt Coverage: CR's debt is well covered by operating cash flow (39.7%).

Interest Coverage: CR's interest payments on its debt are well covered by EBIT (10.6x coverage).


Balance Sheet


Next Steps

Dividend

What is Crane's current dividend yield, its reliability and sustainability?

3.53%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CR's dividend (3.53%) is higher than the bottom 25% of dividend payers in the US market (2.01%).

High Dividend: CR's dividend (3.53%) is low compared to the top 25% of dividend payers in the US market (5.66%).


Stability and Growth of Payments

Stable Dividend: CR's dividends per share have been stable in the past 10 years.

Growing Dividend: CR's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (70%), CR's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CR's dividends in 3 years are forecast to be well covered by earnings (25.6% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.9yrs

Average management tenure


CEO

Max Mitchell (55yo)

6.25s

Tenure

US$7,190,812

Compensation

Mr. Max H. Mitchell has been the Chief Executive Officer and President of Crane Co. since January 31, 2014 and January 28, 2013 respectively. Mr. Mitchell served as the Chief Operating Officer of Crane Co. ...


CEO Compensation Analysis

Compensation vs Market: Max's total compensation ($USD7.19M) is about average for companies of similar size in the US market ($USD5.69M).

Compensation vs Earnings: Max's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Max Mitchell
President6.25yrsUS$7.19m0.39% $11.3m
Richard Maue
Senior VP & CFO7.25yrsUS$2.40m0.10% $3.0m
Anthony D'Iorio
VP, General Counsel & Secretary2.17yrsUS$1.38m0.015% $426.9k
Bradley Ellis
Senior Vice President5.33yrsUS$1.95m0.32% $9.4m
Kurt Gallo
Senior Vice President of Payment & Merchandising Technologies1yrUS$1.45m0.049% $1.4m
Christina Cristiano
VP, Controller & Principal Accounting Officer0.75yrno datano data
Carey True
Chief Information Officerno datano datano data
Jason Feldman
Director of Investor Relationsno datano datano data
James Lavish
Vice President of People & Performance4.25yrsno data0.029% $824.9k
Edward Switter
VP of Tax & Treasurer3.58yrsno data0.040% $1.2m

3.9yrs

Average Tenure

50.5yo

Average Age

Experienced Management: CR's management team is considered experienced (3.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Max Mitchell
President6.25yrsUS$7.19m0.39% $11.3m
Robert Evans
Independent Non-Executive Chairman19yrsUS$265.99k0.67% $19.5m
Martin Benante
Independent Director5.25yrsUS$243.08k0.00024% $6.9k
Michael Dinkins
Independent Director1yrUS$197.98kno data
James L. Tullis
Independent Chairman of the Board22.25yrsUS$259.26k0.0093% $268.9k
Charles McClure
Independent Director3yrsUS$253.48k0.00050% $14.4k
Jennifer Pollino
Independent Director7yrsUS$243.52kno data
Donald Cook
Independent Director14.67yrsUS$263.76k0.0054% $157.4k
Ronald Lindsay
Independent Director7yrsUS$290.01k0.0010% $28.9k
Ellen Haime
Independent Director7yrsUS$243.52kno data

7.0yrs

Average Tenure

65yo

Average Age

Experienced Board: CR's board of directors are considered experienced (7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CR insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Crane Co.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Crane Co.
  • Ticker: CR
  • Exchange: NYSE
  • Founded: 1855
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$2.888b
  • Shares outstanding: 59.20m
  • Website: https://www.craneco.com

Number of Employees


Location

  • Crane Co.
  • 100 First Stamford Place
  • Stamford
  • Connecticut
  • 6902
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CRNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
CZNDB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
CZNBRSE (Berne Stock Exchange)YesCommon StockCHCHFJan 1968

Biography

Crane Co. manufactures and sells engineered industrial products in the United States and internationally. The company's Fluid Handling segment offers on/off valves and related products for application in the chemical, oil and gas, power, and general industrial end markets; valves and related products for the non-residential construction, general industrial, and municipal markets; fluid control instrumentation and sampling solutions; and pumps and related products for water and wastewater applications in the industrial, municipal, commercial, and military markets under the Crane, Saunders, Jenkins, Pacific, Xomox, Krombach, DEPA, ELRO, REVO, Flowseal, Centerline, Resistoflex, Duochek, Barksdale, Westlock, WTA, HOKE, DOPAK, Stockham, Wask, Viking Johnson, IAT, Hattersley, NABIC, Sperryn, Wade, Deming, Weinman, Burks, and Barnes brands. Its Payment & Merchandising Technologies segment provides coin and bill acceptors, dispensers and recyclers, cashless systems, cash and coin counting, and sorting machines; engineered banknotes; retail cash office solutions; vending equipment that dispenses food, snack, and hot and cold beverages; and vending management software, cashless payment, and wireless connectivity products. It serves retail self-checkout, vending, casino gaming, government lotteries, parking, transit fare collection, payment kiosks, and financial markets; vending operators; and food and beverage companies. The company's Aerospace & Electronics segment offers original equipment and aftermarket parts under the Hydro-Aire, ELDEC, Lear Romec, P.L. Porter, Keltec, Interpoint, Signal Technology, Merrimac Industries, and Polyflon brands to commercial and military aerospace, and defense markets. Its Engineered Materials segment provides fiberglass-reinforced plastic panels and coils for use in the manufacture of recreational vehicles, truck bodies and trailers, and commercial and industrial buildings. Crane Co. was founded in 1855 and is based in Stamford, Connecticut. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/07 03:04
End of Day Share Price2020/04/06 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.