The Gorman-Rupp Company (GRC) is expected to grow sales by an average of 19.3% over the next 5 years, well ahead of the industry average of 16.5%.
The Gorman-Rupp Company is one of the leading manufacturer of pumps.
It produces all kinds of pumps and pump related equipment such as pump and motor controls for use in water, wastewater, construction, industrial, petroleum, original equipment, agriculture, HVAC, heating, and the military.
The company has customers in 100 countries. In 2009, international shipments were 36% of the company’s total sales.
Gorman-Rupp Beat By 17% in the Second Quarter
On July 22, Gorman-Rupp reported second quarter results that surprised on the Zacks Consensus for the third time in the last 4 quarters.
Earnings per share were 34 cents compared to the consensus of 29 cents. The company earned 29 cents in the year ago period.
Revenue rose 5.9% to $72.4 million from $68.3 million in the second quarter of 2009.
The increase was primarily due to a rise in sales in the international fire protection market, custom pump applications and the construction and rental market as well as, simply, an overall global recovery.
Uncertain Outlook
The company was still cautious, saying that while customer order growth was adding to optimism, a full economy recovery remained “uncertain.”
It also called current conditions an “unpredictable environment”.
Zacks Consensus Estimates Signal Growth Anyway
Despite the cautious company tone after the second quarter results, that hasn’t stopped analysts from being more bullish.
The 2010 Zacks Consensus is up by 9 cents to $1.26 per share in the last 2 months. This is earnings growth of 15.6%.
Similarly, business looks strong going into 2011, as another 15.1% earnings growth is expected as the Zacks Consensus has risen by 7 cents to $1.45 per share in the last 60 days.
Paying Dividends for 60 Years
Gorman-Rupp is one of those companies that quietly goes about its business and does so decade after decade.
Founded in 1933, the company will pay its 242nd consecutive dividend in September.
The dividend currently yields 1.70% which is higher than the industry average, which is zero.
Gorman-Rupp is a Zacks #1 Rank (strong buy) stock.
Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.
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