Crane Co. reported better-than-expected 3Q results. EPS declined 25% year-over-year to $1.05 but came ahead of analysts’ expectations of $0.79. Meanwhile, revenues of the industrial products maker fell 5% year-on-year to $735 million and exceeded the Street consensus of $670.7 million.
Crane’s (CR) said it experienced weakness in core sales due to pandemic-led macroeconomic factors.
For 2020, the company now expects adjusted EPS in the range of $3.75-$4.00, compared with the prior range of $3.30-$4.10. Free cash flow is forecast at $230-$260 million up from its earlier guidance of $200-$250 million. (See CR stock analysis on TipRanks).
On Oct. 7, D.A. Davidson analyst Matt Summerville raised the company’s FY20 EPS estimates by 10 cents to $3.80. Summerville maintained a Buy rating on the stock with a price target of $75 (39.02% upside potential). The analyst sees potential upside in the company’s Payment & Merchandising Technologies segment and in the Engineered Materials unit amid a strong recovery in RV (recreational vehicle) demand. While, he is cautious about the commercial aerospace and fluid markets, the analyst is optimistic about Crane’s current valuation, dividend yield, and balance sheet.
Currently, the Street has a cautiously optimistic outlook on the stock with a Moderate Buy analyst consensus. The average price target of $70.50 implies upside potential of about 30.7% to current levels. Shares are down by 37.5% year-to-date.
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