Carpenter Technology (CRS) AI Stock Analysis

• Market Cap: $19.00B
• Dividend Yield: 0.24%
• Average Volume (3M): 739.76K
• Price to Earnings (P/E): 37.4
• Beta (1Y): 1.56
• Revenue Growth: 2.40%
• EPS Growth: 81.54%
• Country: US
• Employees: 4,600
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): 2.33
• Shares Outstanding: 49,809,715
• 10 Day Avg. Volume: 688,730
• 30 Day Avg. Volume: 739,758
• PEG Ratio: 0.37
• Price to Book (P/B): 7.35
• Price to Sales (P/S): 4.82
• P/FCF Ratio: 48.49
• Enterprise Value/Market Cap: 1.02
• Enterprise Value/Revenue: 6.61
• Enterprise Value/Gross Profit: 22.92
• Enterprise Value/Ebitda: 26.58
• 1Y Price Target: $401.25
• Price Target Upside: 5.19% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 10.24
• Revenue Forecast (FY): $3.11B

• Rating: 78 Outperform
• Price Target: $470.00 ▲(23.21% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by strong recent financial performance and bullish technicals, reinforced by an earnings call that raised guidance and highlighted sustained margin and demand momentum. The main restraint is valuation, with a high P/E and low dividend yield, plus some cyclical and segment-specific volatility risks.

Positive Factors

Sustained Margin Expansion

Sixteen consecutive quarters of SAO margin expansion and a record 33.1% margin point to durable pricing power, manufacturing productivity, and product-mix improvements in high-value alloys. This persistent margin strength supports long-term cash generation and ROE, indicating structural competitive advantages in metallurgy and customer relationships.

Strong Cash Generation & Liquidity

Robust trailing cash flow and large available liquidity provide durable financial flexibility to fund brownfield expansion, buybacks, dividends, and debt refinancing. Strong cash conversion in the recent period enhances resilience through cycles and improves the company’s ability to invest in capacity and long-term contracts.

Aerospace Demand & Pricing Tailwinds

Rising aerospace bookings and long-term price agreements reflect structural demand growth and contract-based pricing power in high-spec alloys. This reduces revenue volatility from spot markets, supports margin durability, and aligns Carpenter with multi-year aerospace programs that drive predictable, high-value revenue streams.

Negative Factors

Cyclicality and Historical Profit Volatility

Specialty metals are cyclical; prior-year losses show earnings and cash flow can reverse sharply when end markets soften. Even with current strength, the company remains exposed to aerospace, energy, and industrial cycles, which can quickly erode margins, cash generation, and returns over a 2–6 month to multi-year horizon.

PEP / Medical Distribution Weakness

Concentration in titanium medical distribution and a sharp PEP sales decline show end-market and customer-channel vulnerability. Continued weakness in this segment would limit diversification benefits, depress segment profitability, and could require higher working capital or restructuring to restore normalized returns.

Sizable Remaining Debt & Capital Intensity

Meaningful outstanding debt combined with heavy near-term capex for the brownfield expansion increases fixed obligations and capital intensity. In a cyclical downturn this can constrain free cash flow flexibility, slow de-leveraging, or force reduced returns as cash is prioritized for debt service and maintenance capex.

Carpenter Technology Business Overview & Revenue Model

Company Description

Carpenter Technology Corporation engages in the manufacture, fabrication, and distribution of specialty metals in the United States, Europe, the Asia Pacific, Mexico, Canada, and internationally. It operates in two segments, Specialty Alloys Operations and Performance Engineered Products. The company offers specialty alloys, including titanium alloys, powder metals, stainless steels, alloy steels, and tool steels, as well as additives, and metal powders and parts. It serves aerospace, defense, medical, transportation, energy, industrial, and consumer markets. The company was founded in 1889 and is headquartered in Philadelphia, Pennsylvania.

How the Company Makes Money

Carpenter Technology generates revenue primarily through the sale of specialty alloys and metal products to various industries, including aerospace, defense, and medical sectors. The company has a diversified revenue model that includes direct sales, long-term contracts, and agreements with key customers. Significant revenue streams come from the production of high-performance materials that are often used in critical applications. Additionally, Carpenter Technology benefits from strategic partnerships with major players in its target industries, enabling it to access a wider market and enhance its product offerings. The company also invests in research and development to innovate and improve its product lines, further driving revenue growth through the introduction of new, high-demand materials.

Carpenter Technology Financial Statement Overview

Summary

Fundamentals are strong in the most recent period, with a sharp earnings turnaround, significant margin expansion, and materially higher operating/free cash flow. Offsetting factors are cyclicality (prior-year losses and historically uneven free cash flow) and only moderate cash conversion versus net income.

Income Statement

CRS shows a strong multi-year earnings turnaround and clear margin expansion. In TTM (Trailing-Twelve-Months), revenue is $2.94B and profitability is robust with ~28% gross margin, ~20% operating margin, and ~14% net margin, up materially versus FY2023–FY2024. The main offset is that the reported TTM revenue growth rate is unusually high (suggesting potential volatility or a non-recurring surge), and the company’s history includes weak/negative profitability in FY2021–FY2022, which raises cyclicality risk even though current performance is strong.

Balance Sheet

Leverage is moderate and improving, with debt-to-equity down from ~0.53 (FY2022) to ~0.37 in TTM (Trailing-Twelve-Months). Equity has grown meaningfully over time (from ~$1.33B in FY2022 to ~$1.99B in TTM), and returns have improved sharply with return on equity at ~23% in TTM. The key watch item is that total debt remains sizable (~$690M TTM), so the balance sheet is solid but still carries meaningful financial obligations for a cyclical manufacturing business.

Cash Flow

Cash generation is strong in the most recent period, with TTM (Trailing-Twelve-Months) operating cash flow of ~$504M and free cash flow of ~$317M, improving from FY2024–FY2025 levels and showing strong free cash flow growth in TTM. However, free cash flow is only about ~61% of net income in TTM (and ~65% in FY2025), indicating that earnings are not fully converting to free cash flow. The longer track record is also mixed, including negative free cash flow in FY2022–FY2023, which suggests cash flow can be volatile across the cycle.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	2.94B	2.88B	2.76B	2.55B	1.84B	1.48B
Gross Profit	849.50M	768.60M	584.30M	337.30M	149.80M	1.00M
EBITDA	732.40M	670.40M	411.60M	267.60M	113.20M	-140.70M
Net Income	434.90M	376.00M	186.50M	56.40M	-49.10M	-229.60M
Balance Sheet
Total Assets	3.50B	3.49B	3.29B	3.05B	2.93B	2.97B
Cash, Cash Equivalents and Short-Term Investments	231.90M	315.50M	199.10M	44.50M	154.20M	287.40M
Total Debt	698.70M	738.30M	741.40M	745.70M	744.40M	739.00M
Total Liabilities	1.52B	1.60B	1.66B	1.66B	1.60B	1.58B
Stockholders Equity	1.99B	1.89B	1.63B	1.40B	1.33B	1.39B
Cash Flow
Free Cash Flow	316.70M	286.10M	178.30M	-67.60M	-85.30M	149.50M
Operating Cash Flow	503.70M	440.40M	274.90M	14.70M	6.00M	250.00M
Investing Cash Flow	-185.60M	-152.90M	-95.90M	-82.30M	-89.10M	-78.90M
Financing Cash Flow	-245.20M	-167.10M	-23.30M	-40.10M	-52.80M	-76.10M

Carpenter Technology Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 381.46
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CRS, the sentiment is Positive. The current price of 381.46 is below the 20-day moving average (MA) of 390.93, above the 50-day MA of 360.72, and above the 200-day MA of 296.31, indicating a neutral trend. The MACD of 5.27 indicates Positive momentum. The RSI at 50.72 is Neutral, neither overbought nor oversold. The STOCH value of 35.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CRS.

Carpenter Technology Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MLI	79 Outperform	$12.30B	16.84	27.46%	0.85%	15.71%	29.60%
CRS	78 Outperform	$19.00B	37.45	22.99%	0.24%	2.40%	81.54%
AZZ	78 Outperform	$3.70B	19.10	26.34%	0.67%	1.55%	701.41%
WOR	70 Outperform	$2.40B	24.74	11.16%	1.27%	7.43%	148.83%
ATI	69 Neutral	$20.38B	39.98	22.69%	―	7.75%	6.84%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
ESAB	61 Neutral	$6.04B	45.18	10.98%	0.33%	1.19%	-7.78%

Carpenter Technology Corporate Events

Carpenter Technology Details Planned CEO Leadership Transition

On February 12, 2026, Carpenter Technology announced that Chief Executive Officer Tony R. Thene had submitted his resignation from the CEO role effective July 1, 2026, and would transition to Executive Chairman of the Board on that date, maintaining an active role in strategy and stakeholder relationships. On the same day, the board appointed current President and Chief Operating Officer Brian Malloy to become President and Chief Executive Officer on July 1, 2026, emphasizing his decade-long leadership in commercial and operational roles and noting there were no related-party conflicts in his selection.

In a February 17, 2026 announcement, the board and senior leaders framed the CEO transition as a planned handover designed to preserve continuity in Carpenter Technology’s growth strategy and operational discipline. Directors highlighted the depth of the management bench and portrayed Malloy’s promotion, alongside Thene’s shift to Executive Chairman, as a move that strengthens strategic oversight and positions the company to build on its momentum and reinforce its leading position in high-value specialty alloy markets.

The leadership change signals a continuation rather than a reset of Carpenter Technology’s strategic direction, centering on serving high-performance, high-value markets and supporting advanced technologies for aerospace, defense, energy, and other critical sectors. Stakeholders are being reassured that the company’s culture of performance, zero-injury focus, and customer partnership will remain intact under Malloy, as the transition keeps the outgoing CEO closely involved while elevating an internal successor with deep business knowledge.

The most recent analyst rating on (CRS) stock is a Buy with a $431.00 price target. To see the full list of analyst forecasts on Carpenter Technology stock, see the CRS Stock Forecast page.