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Gorman-Rupp Hits New 52-Week High

Zacks Equity Research

Shares of Gorman-Rupp Co. (GRC) touched a new 52-week high of $38.20 during its trading session on Sep 9. This denotes an increase over the previous high of $38.10 reached on Sep 6.  

Gorman-Rupp closed the trading day on Sep 9 at $38.19, reflecting a solid year-to-date return of 41.1%. The trading volume for the session was 0.03 million shares. Further upside potential exists for this Zacks Rank #1 (Strong Buy) diversified machinery company as can be deduced from its earnings estimate revisions in the last 60 days and expected earnings growth of 7.7% for 2013.

Growth Drivers

Gorman-Rupp’s second quarter 2013 financial results reported on Jul 26, 2013 were impressive. Earnings per share were 43 cents, an increase from 36 cents earned in the year-ago quarter and 30.3% above the Zacks Consensus Estimate of 33 cents. Excluding non-cash pension settlement charge, earnings per share came in at 48 cents.

Revenue in the quarter grew 14.9% year over year on the back of 28.4% increase in international sales, offset partially by 4.0% decrease in domestic sales. Backlog of orders in the quarter grew 46.1% year over year. Gross margin came in at 24.9%, up from 24.6% reported in the year-ago quarter.

Besides these, Gorman-Rupp also has a solid balance sheet with a cash and cash equivalent balance of $27.1 million. The company is also a consistent dividend payer having paid 10 cents on each common share outstanding.

Estimate Revisions Show Potency

Over the last 60 days, the Zacks Consensus Estimate for Gorman-Rupp increased by 14.1% to $1.54 for 2013 and by 12.6% to $1.79 for 2014, respectively.

Other stocks to watch out for in the industry are Graham Corp. (GHM) with a Zacks Rank # 1 (Strong Buy) while DXP Enterprises, Inc. (DXPE) and EnPro Industries, Inc. (NPO), each carry a Zacks Rank #2 (Buy).

Read the Full Research Report on DXPE

Read the Full Research Report on GHM

Read the Full Research Report on NPO

Read the Full Research Report on GRC

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