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Crane (CR) Hosts Annual Investor Day, Raises 2021 Projections

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Zacks Equity Research
·3 min read
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Crane Co. CR at its annual investor day communicated that solid recovery in markets, organic growth investments, and mergers and acquisitions will be important for its prospects. It also revised key projections upward for 2021.

Talking about end markets, the company believes that its Aerospace and Electronics segment will benefit from growth in power conversion, electrification, thermal management, sensing and space markets. The Fluid Handling segment’s performance will get a boost from improvements in general industrial, chemical and pharmaceutical markets. The Payment and Merchandising Technologies will gain from a recovery in the security, productivity and automation business.

Investments in organic growth too are priorities for the company. Important areas of investment include product development, technology, innovation, commercial excellence and localization.

As regard to the projections for 2021, net sales are now expected to be $3,080 million, marking a rise from $3,055 million mentioned previously. On a year-over-year basis, the revised sales projection reflects growth of 5% (or 2-4% organically) as compared with the earlier expectation of an increase of 4% (or 1-3% organically).

On a segmental basis, organic sales of Fluid Handling are expected to grow 0.5% from the previous year, while the same for Payment and Merchandising Technologies is likely to advance 6%. Organic sales for Aerospace and Electronics are expected to decline 8% and that for Engineered Materials is expected to increase 20%.

Earnings per share are anticipated to be $5.00-$5.20, up from $4.90-$5.10 mentioned previously. Notably, the revised projection reflects year-over-year growth of 33% versus the earlier expectation of a 30% increase. Free cash flow is now expected to be $265-$295 million, up $5 million from the earlier expectation.

Then again, the company maintained a few projections that it provided along with the fourth-quarter 2020 results. Acquisitions are expected to contribute $5 million to sales, while movements in foreign currencies are projected to boost the top line by 1.5%. Adjusted tax rate had been maintained at 21.5%, corporate expenses at $65 million, and capital expenditure at $75 million.

Over the long term, Crane anticipates average core growth of 2-4% for Fluid Handling, 3-5% for Payment and Merchandising Technologies, 3-5% for Aerospace and Electronics and that for Engineered Materials to be in line with GDP. Core earnings before interest and tax are predicted to increase 6-8% in the long term.

Zacks Rank, Price Performance and Earnings Estimates

With a market capitalization of $5 billion, Crane currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past three months, the company’s share price increased 21.8% as compared with the industry’s growth of 6.4%. It is performing better than some players in the industry, including 3M Company MMM, Danaher Corporation DHR and Carlisle Companies Incorporated CSL.




Also, the Zacks Consensus Estimate of Crane’s earnings is pegged at $1.20 for the first quarter of 2021 and $5.03 for 2021, reflecting increases of 7.1% and 3.3% from the respective 30-day-ago figures.

Crane Co. Price and Consensus

Crane Co. Price and Consensus
Crane Co. Price and Consensus

Crane Co. price-consensus-chart | Crane Co. Quote

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