Gorman-Rupp (NYSE:GRC) - Share price, News & Analysis

Q: What is the Fair Price of GRC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

GRC ($28.89) is trading below our estimate of [[fair value]] ($41.84)

GRC fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	5/6
Past Performance	3/6
Financial Health	6/6
Dividends	5/6

GRC Stock Overview

The Gorman-Rupp Company designs, manufactures, and sells pumps and pump systems in the United States and internationally.

Rewards

Trading at 30.9% below our estimate of its fair value

Earnings are forecast to grow 27% per year

Earnings have grown 0.3% per year over the past 5 years

Pays a reliable dividend of 2.35%

Risk Analysis

No risks detected for GRC from our risk checks.

Gorman-Rupp Competitors

Columbus McKinnon

NasdaqGS:CMCO

US$874.8m

Fathom Digital Manufacturing

NYSE:FATH

US$566.9m

Tennant

NYSE:TNC

US$1.1b

Standex International

NYSE:SXI

US$1.0b

Price History & Performance

Summary of all time highs, changes and price drops for Gorman-Rupp
Historical stock prices
Current Share Price	US$28.89
52 Week High	US$47.12
52 Week Low	US$27.45
Beta	0.63
1 Month Change	-2.00%
3 Month Change	-22.02%
1 Year Change	-15.67%
3 Year Change	-11.62%
5 Year Change	13.03%
Change since IPO	806.84%

Recent News & Updates

May 02

Estimating The Fair Value Of The Gorman-Rupp Company (NYSE:GRC)

How far off is The Gorman-Rupp Company ( NYSE:GRC ) from its intrinsic value? Using the most recent financial data...

Shareholder Returns

	GRC	US Machinery	US Market
7D	4.3%	1.8%	6.3%
1Y	-15.7%	-19.8%	-18.8%

Return vs Industry: GRC exceeded the US Machinery industry which returned -20.1% over the past year.

Return vs Market: GRC exceeded the US Market which returned -18.4% over the past year.

Price Volatility

Is GRC's price volatile compared to industry and market?
GRC volatility
GRC Average Weekly Movement	4.0%
Machinery Industry Average Movement	6.0%
Market Average Movement	8.1%
10% most volatile stocks in US Market	16.7%
10% least volatile stocks in US Market	3.2%

Stable Share Price: GRC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: GRC's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1933	1,150	Scott King	https://www.gormanrupp.com

The Gorman-Rupp Company designs, manufactures, and sells pumps and pump systems in the United States and internationally. The company’s products include self-priming centrifugal, standard centrifugal, magnetic drive centrifugal, axial and mixed flow, vertical turbine line shaft, submersible, high pressure booster, rotary gear, diaphragm, bellows, and oscillating pumps. Its products are used in water, wastewater, construction, dewatering, industrial, petroleum, original equipment, agriculture, fire protection, military, and other liquid-handling applications, as well as in heating, ventilating, and air conditioning applications.

Gorman-Rupp Fundamentals Summary

How do Gorman-Rupp's earnings and revenue compare to its market cap?
GRC fundamental statistics
Market Cap	US$754.13m
Earnings (TTM)	US$29.97m
Revenue (TTM)	US$391.46m

25.2x

P/E Ratio

1.9x

P/S Ratio

Is GRC overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
GRC income statement (TTM)
Revenue	US$391.46m
Cost of Revenue	US$293.10m
Gross Profit	US$98.35m
Other Expenses	US$68.39m
Earnings	US$29.97m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Jul 29, 2022

Earnings per share (EPS)	1.15
Gross Margin	25.12%
Net Profit Margin	7.65%
Debt/Equity Ratio	0.0%

How did GRC perform over the long term?

See historical performance and comparison

Dividends

2.4%

Current Dividend Yield

57%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is GRC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for GRC?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GRC. This is calculated by dividing GRC's market cap by their current preferred multiple.
What is GRC's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$754.13m

GRC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.6x
Enterprise Value/EBITDA	12.8x
PEG Ratio	0.9x

Price to Earnings Ratio vs Peers

How does GRC's PE Ratio compare to its peers?

GRC PE Ratio vs Peers

The above table shows the PE ratio for GRC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	18.5x
CMCO Columbus McKinnon	29.5x	35.1%	US$874.8m
FATH Fathom Digital Manufacturing	6x	-41.1%	US$566.9m
TNC Tennant	22x	23.2%	US$1.1b
SXI Standex International	16.6x	20.1%	US$1.0b
GRC Gorman-Rupp	25.2x	27.0%	US$754.1m

Forward PE

Price-To-Earnings vs Peers: GRC is expensive based on its Price-To-Earnings Ratio (25.2x) compared to the peer average (18.5x).

Price to Earnings Ratio vs Industry

How does GRC's PE Ratio compare vs other companies in the US Machinery Industry?

Price-To-Earnings vs Industry: GRC is expensive based on its Price-To-Earnings Ratio (25.2x) compared to the US Machinery industry average (21.7x)

Price to Earnings Ratio vs Fair Ratio

What is GRC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

GRC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	25.2x
Fair PE Ratio	20.6x

Price-To-Earnings vs Fair Ratio: GRC is expensive based on its Price-To-Earnings Ratio (25.2x) compared to the estimated Fair Price-To-Earnings Ratio (20.6x).

Share Price vs Fair Value

What is the Fair Price of GRC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: GRC ($28.89) is trading below our estimate of fair value ($41.84)

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

Price to Earnings Growth Ratio

PEG Ratio: GRC is good value based on its PEG Ratio (0.9x)

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Future Growth

How is Gorman-Rupp forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

27.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: GRC's forecast earnings growth (27% per year) is above the savings rate (1.9%).

Earnings vs Market: GRC's earnings (27% per year) are forecast to grow faster than the US market (13.9% per year).

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

Revenue vs Market: GRC's revenue (22.2% per year) is forecast to grow faster than the US market (8.4% per year).

High Growth Revenue: GRC's revenue (22.2% per year) is forecast to grow faster than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: Insufficient data to determine if GRC's Return on Equity is forecast to be high in 3 years time

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Past Performance

How has Gorman-Rupp performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

0.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: GRC has high quality earnings.

Growing Profit Margin: GRC's current net profit margins (7.7%) are lower than last year (7.8%).

Past Earnings Growth Analysis

Earnings Trend: GRC's earnings have grown by 0.3% per year over the past 5 years.

Accelerating Growth: GRC's earnings growth over the past year (10.4%) exceeds its 5-year average (0.3% per year).

Earnings vs Industry: GRC earnings growth over the past year (10.4%) underperformed the Machinery industry 24%.

Return on Equity

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

Discover strong past performing companies

Financial Health

How is Gorman-Rupp's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: GRC's short term assets ($288.7M) exceed its short term liabilities ($59.5M).

Long Term Liabilities: GRC's short term assets ($288.7M) exceed its long term liabilities ($38.6M).

Debt to Equity History and Analysis

Debt Level: GRC is debt free.

Reducing Debt: GRC had no debt 5 years ago.

Debt Coverage: GRC has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: GRC has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Gorman-Rupp current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

2.35%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: GRC's dividend (2.35%) is higher than the bottom 25% of dividend payers in the US market (1.57%).

High Dividend: GRC's dividend (2.35%) is low compared to the top 25% of dividend payers in the US market (4.23%).

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (56.6%), GRC's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (69.4%), GRC's dividend payments are covered by cash flows.

Discover strong dividend paying companies

Management

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

3.7yrs

Average management tenure

CEO

Scott King (46 yo)

1.42yrs

Tenure

US$988,095

Compensation

Mr. Scott A. King serves as President of The Gorman-Rupp Company since January 1, 2021 and has been its Chief Executive Officer since January 1, 2022. He had been the Chief Operating Officer of The Gorman-...

CEO Compensation Analysis

Compensation vs Market: Scott's total compensation ($USD988.10K) is below average for companies of similar size in the US market ($USD4.02M).

Compensation vs Earnings: Scott's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: GRC's management team is considered experienced (3.7 years average tenure).

Board Members

Experienced Board: GRC's board of directors are considered experienced (5.7 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/06/27 00:00
End of Day Share Price	2022/06/27 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31