Crane (CR) and General Electric (GE) Critical Analysis

Crane (NYSE: CR) and General Electric (NYSE:GE) are both multi-sector conglomerates companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, dividends, valuation, risk, institutional ownership, analyst recommendations and earnings.

Analyst Recommendations

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This is a breakdown of current ratings and price targets for Crane and General Electric, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Crane 0 3 10 0 2.77
General Electric 4 12 4 0 2.00

Crane presently has a consensus price target of $108.50, suggesting a potential upside of 18.87%. General Electric has a consensus price target of $18.17, suggesting a potential upside of 39.00%. Given General Electric’s higher probable upside, analysts plainly believe General Electric is more favorable than Crane.

Profitability

This table compares Crane and General Electric’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Crane 6.17% 20.66% 7.72%
General Electric -4.74% 11.60% 2.60%

Earnings and Valuation

This table compares Crane and General Electric’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Crane $2.79 billion 1.95 $171.80 million $2.84 32.14
General Electric $122.09 billion 0.93 -$5.79 billion ($0.72) -18.15

Crane has higher earnings, but lower revenue than General Electric. General Electric is trading at a lower price-to-earnings ratio than Crane, indicating that it is currently the more affordable of the two stocks.

Dividends

Crane pays an annual dividend of $1.40 per share and has a dividend yield of 1.5%. General Electric pays an annual dividend of $0.48 per share and has a dividend yield of 3.7%. Crane pays out 49.3% of its earnings in the form of a dividend. General Electric pays out -66.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. General Electric is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Crane has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, General Electric has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.

Insider & Institutional Ownership

69.4% of Crane shares are held by institutional investors. Comparatively, 56.3% of General Electric shares are held by institutional investors. 3.1% of Crane shares are held by company insiders. Comparatively, 1.1% of General Electric shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Crane beats General Electric on 12 of the 16 factors compared between the two stocks.

About Crane

Crane Co. (Crane) is a manufacturer of engineered industrial products. The Company operates through four segments, including Fluid Handling, Payment & Merchandising Technologies, Aerospace & Electronics, and Engineered Materials. The Fluid Handling segment is a provider of engineered fluid handling equipment, including Process Valves and Related Products, Commercial Valves and Other Products. The Payment & Merchandising Technologies segment includes Crane Payment Innovations (CPI) and Merchandising Systems. The Aerospace & Electronics segment supplies various components and systems, including original equipment and aftermarket parts, primarily for the commercial aerospace and military aerospace, and defense markets. The Engineered Materials segment manufactures fiberglass-reinforced plastic (FRP) panels and coils, primarily for use in the manufacturing of recreational vehicles (RVs), truck bodies, truck trailers, with additional applications in commercial and industrial buildings.

About General Electric

General Electric Company operates as a digital industrial company worldwide. It operates through Power, Renewable Energy, Oil & Gas, Aviation, Healthcare, Transportation, Lighting, and Capital segments. The Power segment offers technologies, solutions, and services related to energy production, including gas and steam turbines, engines, generators, and high voltage equipment; and power generation services and digital solutions. The Renewable Energy segment provides wind turbine platforms, and hardware and software; offshore wind turbines; solutions, products, and services to hydropower industry; and blades for onshore and offshore wind turbines. The Oil & Gas segment offers oilfield services, oilfield equipment, turbomachinery and process solutions, and digital solutions. The Aviation segment provides jet engines and turboprops; maintenance, component repair, and overhaul services, as well as replacement parts; and additive machines, materials, and engineering services. The Healthcare segment offers diagnostic imaging and clinical systems; products, services, and manufacturing solutions for drug discovery, the biopharmaceutical industry, and cellular and gene therapy technologies; and medical technologies, software, analytics, cloud solutions, and implementation and services. The Transportation segment provides freight and passenger locomotives, and rail and support advisory services; parts, integrated software solutions, and data analytics; software-enabled solutions; mining equipment and services; and marine diesel and stationary power diesel engines and motors, as well as overhaul, repair and upgrade, and wreck repair services. The Lighting segment offers light emitting diode products; and energy efficiency and productivity solutions. The Capital segment provides industrial and energy financial services; and commercial aircraft leasing, financing, and consulting services. General Electric Company was founded in 1892 and is headquartered in Boston, Massachusetts.

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