Crane: 2.2% Yield, Double Digit EPS Growth Potential

Crane: 2.2% Yield, Double Digit EPS Growth Potential

Crane Co. () recently delivered a seventh uninterrupted certain gain warn on 18% sales expansion and an expanding operating margin. Analysts lifted their estimates following clever third entertain results, promulgation a batch to a Zacks #2 Rank (Buy).

Based on accord estimates, analysts plan 31% EPS growth for Crane this year and 14% expansion subsequent year. On tip of this, a association pays a pision that yields 2.2%.

Crane manufactures rarely engineered industrial products for a aerospace, electronics, hydrocarbon processing, petrochemical, chemical, energy generation, programmed merchandising, travel and other markets.

Crane has 5 business segments: liquid doing (46% of sales), aerospace & wiring (26%), merchandising systems (15%), engineered materials (8%) and controls (5%). The association was founded in 1855 and has a marketplace tip of $2.7 billion.

Third Quarter Results

Crane reported softened than approaching formula for a third entertain of 2011. Earnings per share came in during 89 cents, violence a Zacks Consensus Estimate by a penny. It was a stellar 27% boost over a same entertain in 2010.

Sales jumped 18% to $659 million, good brazen of a Zacks Consensus Estimate of $634 million. Crane gifted an 11% boost in core sales and benefited 3% from unfamiliar banking effects and 3% from an acquisition.

Except for engineered materials, any shred gifted year-over-year sales growth. Operating distinction surged 31% as a association leveraged a bound expenses. The handling domain softened from 11.2% to 12.5% of sales.

Outlook

Following a clever third quarter, CEO Eric Fast settled that "although there are indications of a negligence tellurian economy, a strengthened portfolio of businesses and extended geographic bearing position us good for essential growth."

Management also lifted a reduce finish of a gain superintendence range. It now expects 2011 EPS between $3.35 and $3.45 per share. This stirred analysts to correct their estimates higher, promulgation a batch to a Zacks #2 Rank (Buy). The Zacks Consensus Estimate for 2011 is $3.40, within guidance, and representing 31% expansion over 2010 EPS. The 2012 consensus estimate is now $3.86, analogous with 14% EPS growth.

Consensus estimates have usually risen over a final several months as Crane has delivered 7 uninterrupted certain gain surprises:

Dividend

On tip of clever EPS growth, Crane pays a pision that yields a plain 2.2%. As we can see, a association has been lifting a pision over a final several years:

Valuation

The gratefulness design looks really reasonable for Crane. Shares trade during only 12.2x 12-month brazen earnings, in-line with a attention average. Its price-to-book ratio of 2.5 is a slight reward to a attention normal of 2.3, though this appears to be fit given a higher gain on equity.

The Bottom Line

With clever gain momentum, plain expansion projections, an appealing 2.2% pision produce and reasonable valuation, Crane offers investors a lot to like.

Todd Bunton is a expansion & income batch strategist for and co-editor of a .

News referensi http://news.yahoo.com/crane-2-2-yield-double-digit-eps-growth-174114912.html