Crane (CR)
has always been a bit of an odd duck. While there are plenty of
multi-industrials out there, Crane’s $3 billion revenue base and $5
billion market cap makes it a small player among the conglomerates and
one with a fairly unusual (albeit very diverse) mix of end-markets. It’s
also not especially widely-followed, with only about a half-dozen
sell-side analysts covering it and less than 75% institutional
ownership. Now add in some odd trends and market signals, and this is a
somewhat challenging story to evaluate.
I didn’t like Crane’s valuation back in February
of this year, and the shares have underperformed the broader industrial
group since then (as well as the S&P 500) with a roughly 10%
decline. Now, though, there seems to be growing momentum in the Fluid
Handling and Aero businesses, and margins seem to be coming along a
little better than expected. If Crane’s late-cycle exposure bears it out
as a late bloomer, this could now be a time to consider the shares.
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Amid A Lot Of Mixed Signals, Crane Seems To Offer Some Value
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