Carpenter Technology (CRS) AI Stock Analysis

• Market Cap: $8.54B
• Dividend Yield: 0.38%
• Average Volume (3M): 913.75K
• Price to Earnings (P/E): 32.3
• Beta (1Y): 1.39
• Revenue Growth: 7.40%
• EPS Growth: 168.67%
• Country: US
• Employees: 4,600
• Sector: Industrials
• Sector Strength: 79
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): 1.66
• Shares Outstanding: 49,948,635
• 10 Day Avg. Volume: 1,031,996
• 30 Day Avg. Volume: 913,746
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.19
• Price to Cash Flow (P/CF): 33.80
• P/FCF Ratio: 33.60
• Enterprise Value/Market Cap: 1.07
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 15.65
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $245.00
• Price Target Upside: 15.02% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

Carpenter Technology scores highly due to its strong financial performance, robust earnings report, and strategic corporate actions. While the stock's valuation appears high, its positive market momentum and favorable corporate developments support a solid overall investment outlook.

Positive Factors

Earnings

Carpenter Technology reported adjusted EPS above consensus estimates due to productivity, improved mix, and higher pricing.

Financial Performance

The company has consistently beat expectations, which is seen as worthy of a premium valuation for superior management.

Market Demand

CRS order intake was +20% sequentially, with customers still pushing to get CRS deliveries earlier than planned.

Negative Factors

Free Cash Flow

Free cash flow was weaker year-over-year due to higher discretionary pension contributions and increased capital expenditures.

Lead-Times

Lead-times for Carpenter Technology Corporation are currently running at 65 weeks, indicating the strength and scarcity of its offerings.

Tariff Uncertainty

Tariff uncertainty remains a near-term risk, likely affecting lead-times for CRS.

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 makes money primarily through the manufacturing and sale of premium specialty alloys and stainless steels. The company generates revenue by supplying materials that are critical for high-performance applications in industries such as aerospace, defense, medical, energy, and transportation. Key revenue streams include the sale of engineered products that meet specific customer requirements, often involving high-precision and high-strength specifications. Carpenter Technology also engages in strategic partnerships and collaborations that enhance its product offerings and expand its market reach. Additionally, the company invests in research and development to innovate and improve its product lines, which helps maintain its competitive edge and attract new business opportunities.

Carpenter Technology Financial Statement Overview

Summary

Carpenter Technology exhibits strong financial health with substantial revenue growth, improved profit margins, and robust cash flow generation. While the balance sheet is stable, decreasing cash reserves and increasing capital expenditures warrant some caution.

Income Statement

The income statement shows strong revenue growth with a 5.8% increase in TTM compared to the previous year. Gross profit margin improved to 25.6% in TTM, indicating better cost management or pricing strategies. Net profit margin has risen significantly to 12.3%, highlighting improved profitability. Both EBIT and EBITDA margins have shown robust growth, reaching 17.1% and 18.7% respectively, reinforcing operational efficiency.

Balance Sheet

The balance sheet is stable with a moderate debt-to-equity ratio of 0.39 in TTM, indicating manageable leverage. Return on Equity (ROE) improved significantly to 20.1%, showcasing increased returns on shareholder investment. The equity ratio remains healthy at 53.0%, reflecting a strong capital structure. However, the decrease in cash reserves could pose liquidity concerns.

Cash Flow

Cash flow analysis reveals a strong free cash flow growth of 27.7% in TTM, driven by improved operating cash flows. The operating cash flow to net income ratio of 0.98 indicates efficient conversion of net income into cash. Additionally, free cash flow to net income ratio of 0.64 suggests healthy cash generation relative to profitability. However, capital expenditures are increasing, which could impact future cash flows.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
2.76B	2.55B	1.84B	1.48B	2.18B
	Gross Profit
584.30M	337.30M	149.80M	1.00M	358.70M
	EBIT
323.10M	133.10M	-12.20M	-179.20M	158.30M
	EBITDA
397.20M	257.60M	113.60M	-141.20M	150.90M
	Net Income Common Stockholders
186.50M	56.40M	-49.10M	-229.60M	1.50M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
199.10M	44.50M	154.20M	287.40M	193.10M
	Total Assets
3.29B	3.05B	2.93B	2.97B	3.23B
	Total Debt
741.40M	693.00M	701.70M	694.50M	721.80M
	Net Debt
542.30M	648.50M	547.50M	407.10M	528.70M
	Total Liabilities
1.66B	1.66B	1.60B	1.58B	1.78B
	Stockholders Equity
1.63B	1.40B	1.33B	1.39B	1.45B
Cash Flow		Free Cash Flow
178.30M	-67.60M	-85.30M	149.50M	60.40M
	Operating Cash Flow
274.90M	14.70M	6.00M	250.00M	231.80M
	Investing Cash Flow
-95.90M	-82.30M	-89.10M	-78.90M	-171.20M
	Financing Cash Flow
-23.30M	-40.10M	-52.80M	-76.10M	107.80M

Carpenter Technology Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 213.01
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 213.01 is above the 20-day moving average (MA) of 179.97, above the 50-day MA of 185.12, and above the 200-day MA of 170.33, indicating a bullish trend. The MACD of 6.62 indicates Negative momentum. The RSI at 68.36 is Neutral, neither overbought nor oversold. The STOCH value of 86.87 is Negative, 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
CRS	80 Outperform	$8.54B	32.25	21.78%	0.38%	7.40%	168.67%
ESAB	80 Outperform	$7.50B	28.70	16.64%	0.26%	-1.22%	28.46%
ATI	76 Outperform	$9.39B	24.08	25.42%	―	6.82%	3.49%
MLI	75 Outperform	$8.36B	13.77	24.51%	1.13%	18.81%	10.05%
AZZ	70 Outperform	$2.71B	50.62	13.01%	0.75%	2.61%	-53.74%
WOR	66 Neutral	$2.60B	43.48	6.56%	1.29%	-69.82%	-78.10%
Sector *	64 Neutral	$4.28B	11.80	5.33%	250.46%	4.10%	-9.26%

Carpenter Technology Corporate Events

Carpenter Technology Appoints Julie Beck to Board

On February 20, 2025, Carpenter Technology Corporation appointed Julie A. Beck to its Board of Directors, effective immediately. Ms. Beck, who has extensive experience in finance and manufacturing, will serve as a Class II director until the 2027 annual meeting. Her appointment is expected to enhance the company’s growth and shareholder returns, as highlighted by Martin Inglis, Chairman of the Board.

Carpenter Technology Announces $400M Share Repurchase Plan

On February 18, 2025, Carpenter Technology hosted an Investor Update Event to discuss the company’s strategy and growth opportunities. The company has increased its aerospace and defense revenue share to 60% and expanded its market capitalization significantly. The firm is on track to generate substantial cash flow and has initiated a $400 million share repurchase program and a $40 million annual dividend, reflecting a strong shareholder return.