Investment Thesis
Crane Co exhibits critical operational cash flow deterioration (-$29.5M OCF) that contradicts positive net income, signaling fundamental sustainability issues. Combined with zero revenue growth, poor capital returns (ROE 3.2%, ROA 1.7%), and data anomalies (gross margin >100%), the company fails to demonstrate operational health despite adequate liquidity buffers.
Strengths
- Strong liquidity position: 2.85x current ratio with $355.4M cash reserves
- Moderate leverage: 0.57x debt-to-equity with 6.0x interest coverage
- Positive operating margin of 14.4% on reported earnings basis
Risks
- Negative operating cash flow (-$29.5M) indicates core business is not generating cash, raising sustainability concerns
- Stagnant top-line growth (0% YoY revenue) combined with low capital returns (ROE 3.2%, ROA 1.7%)
- Gross margin exceeds 100% — suggests data quality issues or significant accounting anomalies requiring investigation
- EPS growth driven by share buybacks masking underlying operational weakness and zero earnings growth
Key Metrics to Watch
- Operating cash flow trajectory and working capital dynamics
- Gross profit reconciliation and revenue quality
- Revenue growth acceleration and margin sustainability
- Capital expenditure levels and return on invested capital
Financial Metrics
Revenue
696.4M
Net Income
67.1M
EPS (Diluted)
$1.14
Free Cash Flow
-29.5M
Total Assets
4.1B
Cash
355.4M
Profitability Ratios
Gross Margin
124.6%
Operating Margin
14.4%
Net Margin
9.6%
ROE
3.2%
ROA
1.7%
FCF Margin
-4.2%
Balance Sheet & Liquidity
Current Ratio
2.85x
Quick Ratio
1.87x
Debt/Equity
0.57x
Debt/Assets
48.2%
Interest Coverage
5.96x
Long-term Debt
1.2B
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-06T12:19:49.015165 |
Data as of: 2026-03-31 |
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