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Can Crane Stock Beat Quarterly Earnings Estimates?

CR has experienced strong bottom-line growth

Jul 22, 2021 at 10:15 AM
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The shares of manufacturing concern Crane Co. (NYSE:CR) are down 1.2% at $91.53 at last check, ahead of the company's second-quarter earnings report, which is due out after the close on Monday, Aug. 26. Below, we will further explore how the equity has performed on the charts as of late, and dive into some of its previous post-earnings activity.

Crane stock has had a mixed history of post-earnings reactions over the past two years. More specifically, four of these next-day sessions were higher during the company's last eight reports, while four were lower, including a 8% drop in October 2019. Regardless of direction, the security has averaged a post-earnings swing of 3.6% over the past eight quarters. This time, the options market is pricing in a much bigger move of 6.5%.

The equity has jumped 53% year-over-year, and is up 92% since bottoming out at a 52-week low of $48.19 in early October. Additionally, CR has added 22% year-to-date, but is down 7% since reaching a 52-week high of $99.93 in May. Crane stock also has a forward dividend of $1.72, and a dividend yield of 1.98%.

Fundamentally, CR has a decent valuation and solid potential as a recovery play. The security is currently trading at a price-earnings ratio of 23.64, though what makes it an interesting option lies in its forward price-earnings ratio of 16.21. The biggest risk for the equity lies in its weak revenue growth. The company’s trailing 12-month revenues are only up 1.2% in comparison to fiscal 2020. Nonetheless, CR's net income is up 70% since fiscal 2019, making it an attractive investment over the next one to two years.

 

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