Crane Company

Crane Company (CR - Snapshot Report), one of the original S&P 500 companies, continues to return value to shareholders as it recently raised its dividend and full year guidance. This Zacks #1 Rank (strong buy) is still a value stock, with a forward P/E of 13.7.

You might not know the Crane name, but you know some of its products especially its vending machines.

Founded in 1855, the company is a diversified manufacturer in 5 business segments including Aerospace & Electronics which makes landing systems and electronics such as those on Mars Rovers and fighter jets; Engineered Materials such as composites; Merchandising Systems like vending machines; Fluid Control Systems; and Controls.

Dividend Raised Again

Many companies cut or eliminated their dividends during the financial crisis but Crane did not.

In fact, it did the opposite, and has actually raised it from 18 cents per share in 2008 to the recently announced 26 cents payable on Sep 9.

The 26 cent quarterly dividend is 13% higher than the previous quarter's payout of 23 cents.

The increase has pushed up the yield to 2.2%.

The company didn't stop there in rewarding shareholders, though. In the second quarter, it also repurchased 421,300 shares for about $20 million.

Crane Beats For the 6th Quarter in a Row

On July 25, Crane reported its second quarter results and surprised on the Zacks Consensus Estimate by 2.4%. It extended the earnings surprise streak to 6 quarters.

Earnings per share were 85 cents compared to the consensus of 83 cents. The company made only 67 cents in the year ago quarter.

Sales jumped 16% to $644 million from the year ago period with core sales rising 10% on a strong performance in its late-cycle Aerospace and Fluid Handling businesses which saw sales rise 23% and 14%, respectively.

All five of its segments saw sales increases.

Full Year Guidance Raised

Crane expects its earnings to continue to improve in the second half of the year. Earnings guidance was raised to a range of $3.30 to $3.45 from $3.05 to $3.25 provided in April.

This is also much higher than the first 2011 guidance of $2.80 to $3.00.

Sales also were adjusted higher to 14% to 16% growth from prior guidance of 10% to 12%.

2011 Zacks Consensus Estimate Rises

Not surprisingly, analysts scrambled to raise full year estimates based on the bullish guidance.

The Zacks Consensus jumped to $3.39 from $3.25 per share since the report, which is on the high end of Crane's guidance range.

But after the second higher guidance adjustment in the last several months, it seems the analysts are erring on the side of optimism.

Shares Offer Value

Shares were at a 20 year high earlier this year after a huge rally off the 2009 lows. But in 2011, they have mostly been treading water.

The recent pullback in the stock has made Crane even more of a value.

In addition to an attractive P/E under 15, it also has a price-to-book of 2.5. Value is usually found when a company has a P/B ratio under 3.0.

Crane may not get the publicity of an Apple or General Electric, nor does it have the name recognition among investors, but it has been returning value to shareholders since the S&P 500 was created in 1957.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Turnaround Trader and Insider Trader services. You can follow her at twitter.com/traceyryniec.

Read the full analyst report on CR