Back in early May of this year, I decided to revisit Crane NXT, Co. ( CXT ) . In my opinion, it is one of the most interesting businesses on the planet. In addition to engaging in the payments space, the firm operates asCrude Value Insights offers you an investing service and community focused on oil and natural gas. We focus on cash flow and the companies that generate it, leading to value and growth prospects with real potential.Subscribers get to use a 50+ stock model account, in-depth cash flow analyses ...

GREENWICH, Conn., Aug. 25, 2025 (GLOBE NEWSWIRE) -- Gabelli Funds, LLC, is hosting our annual Aerospace & Defense Symposium at The Harvard Club in New York City on September 4th. The conference will draw top executives from more than ten companies, with a focus on the themes of strong demand outlook, high barriers to entry, large aftermarket opportunity, growth in excess of GDP, defense spending, and M&A potential for the Aerospace and Defense industry. Attendees will also have the opportunity to meet with ...

Financial Data and Key Metrics Changes - Adjusted EPS for the quarter was $1.49, reflecting a 6.5% core sales growth driven by aerospace and process flow technologies [4][20] - Core FX neutral backlog increased by 29% year over year, reaching over $1 billion, while core FX neutral orders were up 19% compared to last year [21][24] - Adjusted operating profit increased by 15%, supported by strong net pricing and productivity [20] Business Line Data and Key Metrics Changes - Aerospace and Electronics segment sales reached $258 million, a 12% increase, with total aftermarket sales up 18% [24] - Process Flow Technologies delivered sales of $319 million, up 7%, with core sales growth of 3% [25] - Adjusted segment margin for Aerospace and Electronics was a record high of 26.3%, up from 23.8% last year [24] Market Data and Key Metrics Changes - Aerospace and defense markets are experiencing strong demand, with Boeing ramping up production and solid procurement spending in defense [13][16] - The chemical market is showing softness, particularly in Europe, but other segments like cryogenics and wastewater are growing [48][49] Company Strategy and Development Direction - The company announced the acquisition of Precision Sensors and Instrumentation businesses from Baker Hughes, aiming to enhance its technology portfolio [5][11] - The company is optimistic about deploying further capital for acquisitions, with a robust pipeline of opportunities [6][11] - The strategy focuses on leveraging existing strengths and pursuing new business opportunities to ensure sustainable growth [16][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in raising the full-year adjusted earnings outlook to a range of $5.5 to $5.8 billion, up from the previous range of $5.3 to $5.6 billion [7][28] - The macroeconomic environment remains unpredictable, but strong execution and a solid backlog provide confidence for future performance [7][16] Other Important Information - The company is in a net cash position, with leverage expected to be around 1x net debt to EBITDA after the PSI transaction [22] - Tariff impacts are anticipated to be offset through pricing and productivity measures, with a gross cost increase of approximately $30 million for the year [22][23] Q&A Session Summary Question: Can you discuss the areas of strength in the Aerospace and Electronics business? - Management noted broad-based strength across both commercial and military sectors, with significant orders in air defense and communication platforms for future years [32][34] Question: What is driving the expected drop in A&E margins in the second half? - The mix shift towards commercial OEM and challenging year-over-year comparisons in the aftermarket are expected to impact margins [35][36] Question: How is the GTF program performing in the aftermarket? - The GTF aftermarket revenues are growing at around 15% this year, with expectations of 30% growth next year, although it currently represents less than 5% of commercial aftermarket sales [39][40] Question: Can you provide insights on the cadence of PFT orders? - Orders were up 4% year over year, with stable market conditions, although some softness was noted in the chemical market [46][48] Question: What is the expected impact of the R&D tax changes? - A modest improvement in free cash flow is expected, but nothing significant, estimated to be less than 5% of total free cash flow [57] Question: How confident is the company in achieving the 10% ROIC from the PSI acquisition? - Management expressed high confidence in improving margins and achieving the targeted ROIC through operational efficiencies and strong aftermarket demand [78][79] Question: Are there any signs of project cancellations in the chemical market? - No significant cancellations are observed, but some projects are being pushed to the right due to customer demand uncertainties [94][96]

Financial Data and Key Metrics Changes - Adjusted EPS was $1.49, driven by a 6.5% core sales growth, reflecting strength in aerospace and process flow technologies [4][21] - Adjusted operating profit increased by 15%, driven by strong net price and productivity [21] - Core FX neutral backlog increased by 29% year-over-year, driven by strength in Aerospace and Electronics [21] - Core FX neutral orders were up 19% compared to last year, also driven by Aerospace and Electronics [21] Business Line Data and Key Metrics Changes - Aerospace and Electronics segment sales were $258 million, up 12% in the quarter, with a record backlog of over $1 billion [24] - Total aftermarket sales increased by 18%, with commercial aftermarket sales up 9% and military aftermarket up 37% [24] - Process Flow Technologies delivered sales of $319 million, up 7%, with core sales growth of 3% [25] Market Data and Key Metrics Changes - Aerospace and defense markets continue to see strong demand, with Boeing ramping up production and solid procurement spending in defense [14] - The cryogenics business reached a record high backlog driven by strong demand in space launch and other segments [18] - Chemical market remains stable but soft, with lower CapEx expenditures from customers [48] Company Strategy and Development Direction - The company announced the acquisition of Precision Sensors and Instrumentation businesses from Baker Hughes, aiming to enhance its technology portfolio [5][13] - The company is optimistic about deploying further capital on acquisitions over the next several quarters [6] - The company plans to integrate the acquired businesses into its existing segments to drive growth and operational efficiency [12][73] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in raising the full-year adjusted earnings outlook to a range of $5.5 to $5.8, up from the previous range of $5.3 to $5.6 [6][28] - The macroeconomic environment remains unpredictable, but strong execution and a solid backlog provide confidence for future performance [6][14] - Management noted that while the commercial aftermarket growth may moderate, they expect continued above-market growth in the aerospace and electronics segment [15][19] Other Important Information - The company is in a net cash position and expects leverage to remain below its targeted range after the PSI transaction [22] - Tariff impacts are anticipated to be offset through pricing and productivity measures [22][76] - The company is focused on maintaining its margin profile despite potential headwinds from tariffs [76] Q&A Session Summary Question: Can you discuss the areas of strength in the Aerospace and Electronics business? - Management noted broad-based strength across both commercial and military sectors, with significant orders in air defense and communication platforms for future years [33][34] Question: What is driving the expected drop in A and E margins in the second half? - Management indicated a mix shift towards commercial OEM and challenging comparisons in the aftermarket, leading to a cautious outlook on margins [36][39] Question: How is the GTF program performing in the aftermarket? - The GTF aftermarket revenues are growing at around 15% this year, with expectations of 30% growth next year, although it currently represents less than 5% of commercial aftermarket sales [40][41] Question: Can you provide insights on the cadence of PFT orders and market trends? - Management reported stable market conditions with some softness in the chemical sector, while areas like cryogenics and wastewater are experiencing growth [46][48] Question: What is the expected impact of the R&D tax changes? - Management anticipates a modest improvement in free cash flow due to R&D capitalization and accelerated depreciation, but nothing significant [60] Question: How does the company plan to improve margins in the PSI acquisition? - Management expressed confidence in achieving significant margin improvements through operational efficiencies and leveraging existing strengths in the acquired businesses [83][85] Question: What is the outlook for the nuclear segment post-PSI acquisition? - The company is well-positioned to capitalize on replacement and new nuclear plant restarts, with strong market opportunities in radiation sensing [113][114]

Q2 2025 Financial Performance - Sales increased by 92% to $5772 million compared to Q2 2024[8] - Operating profit increased by 152% to $1029 million compared to Q2 2024[8] - Earnings per share from continuing operations increased by 202% to $137[8] - Adjusted EBITDA increased by 164% to $1219 million[8] - Core growth was +65%, acquisitions contributed +18%, and FX translation added +09% to total sales change[9] Aerospace & Electronics Segment - Sales increased by 118% to $2582 million compared to Q2 2024[11] - Operating profit increased by 288% to $679 million compared to Q2 2024[11] - Backlog increased by 292% to $10528 million[11] - Core growth was +116%, and FX translation added +02% to total sales change[12] Process Flow Technologies Segment - Sales increased by 72% to $3190 million compared to Q2 2024[14] - Operating profit increased by 74% to $639 million compared to Q2 2024[14] - Backlog increased by 08% to $4031 million[14] - Core growth was +26%, acquisitions contributed +32%, and FX translation added +14% to total sales change[15] Acquisition of PSI - Agreement to purchase Precision Sensing and Instrumentation (PSI) from Baker Hughes for $1060 million, net of an expected tax benefit with an NPV of $90 million[20] - PSI's forecast 2025 adjusted EBITDA is approximately $60 million[20]

Core Viewpoint - Baker Hughes has announced the sale of its Precision Sensors & Instrumentation (PSI) product line to Crane Company for approximately $1.15 billion, aligning with its strategy of portfolio optimization and capital reallocation [1][3][4]. Group 1: Transaction Details - The PSI product line includes brands such as Druck, Panametrics, and Reuter-Stokes, which specialize in sensor-based technologies for various industries [2]. - The sale includes all assets of the PSI business, encompassing intellectual property, manufacturing facilities, and resources, with approximately 1,600 employees involved [2]. - The transaction is expected to close by the end of 2025 or early 2026, pending regulatory approvals [5]. Group 2: Strategic Implications - This divestiture is part of Baker Hughes' focus on enhancing its core competencies in rotating equipment, asset performance management, flow control, and decarbonization [3][4]. - The CEO of Baker Hughes emphasized that the transaction reflects the quality of the PSI product lines and their potential under Crane's management, reinforcing the company's commitment to long-term shareholder value [4]. Group 3: Advisory and Background - Evercore is serving as the financial adviser for Baker Hughes in this transaction [5]. - Baker Hughes operates globally, providing energy technology solutions and has a history of over 100 years in the industry [6].

Group 1 - Crane NXT (NYSE: CXT) is the sole supplier of US paper currency to the US government, which positions the company uniquely in the market [1] - The company also provides services related to cash flow and investment opportunities in the oil and natural gas sector, indicating a diversified business model [1] - The focus on cash flow generation highlights the company's commitment to value and growth prospects, appealing to investors looking for real potential [1] Group 2 - Subscribers to the investment service receive access to a 50+ stock model account, which enhances their investment strategies [2] - The service includes in-depth cash flow analyses of exploration and production (E&P) firms, providing valuable insights for investors [2] - Live chat discussions about the sector foster a community environment for subscribers, promoting engagement and knowledge sharing [2]

Group 1 - Crane Company (CR) is experiencing significant activity in the options market, particularly with the Jun 20, 2025 $115 Call showing high implied volatility, indicating potential for a major price movement [1] - Implied volatility reflects market expectations for future stock movement, suggesting that investors anticipate a significant event that could lead to a substantial rally or sell-off [2] - Analysts currently rate Crane Company as a Zacks Rank 3 (Hold) within the Manufacturing - General Industrial industry, which is in the bottom 39% of the Zacks Industry Rank, with recent earnings estimates revised downward from $1.41 to $1.36 per share [3] Group 2 - The high implied volatility surrounding Crane Company may indicate a developing trading opportunity, as options traders often seek to sell premium on such options to capture decay, hoping the stock does not move as much as expected by expiration [4]

Financial Data and Key Metrics Changes - Adjusted EPS for Q1 2025 was $1.39, reflecting a 7.5% core sales growth driven by Aerospace and Electronics and Process Flow Technologies [5][28] - Core orders increased by 16% in the quarter, primarily due to strength in Aerospace and Electronics [5][28] - Adjusted operating profit rose by 18%, supported by volumes, solid net pricing, and productivity [28] Business Line Data and Key Metrics Changes - Aerospace and Electronics segment sales reached $249 million, a 10% increase, with a record backlog of $960 million, up 21% year-over-year [29][30] - Total aftermarket sales in Aerospace and Electronics increased by 20%, with commercial aftermarket sales up 19% and military aftermarket up 24% [29] - Process Flow Technologies delivered sales of $309 million, up 9%, with core sales growth of 5% and a 5% contribution from recent acquisitions [30][31] Market Data and Key Metrics Changes - The Aerospace market remains strong, with Boeing ramping up production and solid procurement spending in defense [16][30] - Core sales growth for Aerospace and Electronics is anticipated to be mid to high single digits for the year, leveraging a 35% to 40% growth rate [17][30] - Process Flow Technologies is positioned to outgrow markets across cycles, focusing on higher growth end markets such as chemicals and pharmaceuticals [20][21] Company Strategy and Development Direction - The company aims to continue driving above-market growth through both organic means and acquisitions, with a strong balance sheet and $1.5 billion in M&A capacity [10][23] - The strategic focus includes investing in technology and new product development while maintaining operational excellence [21][27] - The company is actively pursuing new business opportunities and has a robust pipeline of potential acquisitions across various segments [24][108] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in emerging stronger from current economic challenges, reaffirming the full-year adjusted EPS outlook of $5.3 to $5.6 [6][27] - The company is prepared to adapt to changes in the economic environment, including inflationary pressures and supply chain dynamics [6][15] - Management highlighted the importance of maintaining a flexible and accountable operational structure to navigate uncertainties [15][27] Other Important Information - The company has not seen a slowdown in M&A activity despite macroeconomic challenges, indicating a strong pipeline of potential deals [24][87] - Recent leadership conferences focused on reinforcing best practices and driving growth initiatives across the organization [25][26] - The company expects to manage through potential demand fluctuations without losing sight of long-term goals [21][27] Q&A Session Summary Question: Can you clarify the updated guidance and the contribution of price to sales? - Management expects about 3% overall price contribution, more heavily weighted to Process Flow Technologies [38] Question: Are there any notable items in the defense package that could drive growth? - Management sees broad exposure across defense platforms and anticipates strong demand in munitions and aircraft [44][45] Question: What is the growth split between volume and price in Aerospace and Electronics? - The growth split was roughly 50/50 between volume and price [51] Question: Are there any concerns about supply chain disruptions affecting project deliveries? - Management does not foresee significant disruptions, although some lead time extensions may occur [78] Question: How is the company managing tariff impacts on costs? - The estimated tariff impact is around $60 million for the year, which the company expects to mitigate substantially [95][96] Question: What is the outlook for the chemical market within Process Flow Technologies? - The company anticipates some project activity in the Americas to shift to the right, with softening demand in Europe [98]

Financial Performance - Q1 2025 - Sales increased by 9.3% from $510.2 million in Q1 2024 to $557.6 million in Q1 2025[8] - Operating profit increased by 24.4% from $81.3 million in Q1 2024 to $101.1 million in Q1 2025[8] - Earnings per share from continuing operations increased by 31.4% from $1.02 in Q1 2024 to $1.34 in Q1 2025[8] - Adjusted EBITDA increased by 15.4% from $100.4 million in Q1 2024 to $115.9 million in Q1 2025[8] Segment Performance - Aerospace & Electronics sales increased by 10.2% from $225.9 million in Q1 2024 to $248.9 million in Q1 2025[10] - Aerospace & Electronics backlog increased by 21.3% from $791.8 million in Q1 2024 to $960.1 million in Q1 2025[10] - Process Flow Technologies sales increased by 8.6% from $284.3 million in Q1 2024 to $308.7 million in Q1 2025[12] 2025 Guidance - The company expects revenue between $2.23 billion and $2.27 billion for FY 2025[19] - The company anticipates adjusted segment operating profit between $500 million and $515 million for FY 2025[19] - The company projects core sales growth in the range of 4-6% for FY 2025[21]