CRANE NXT, CO. (CXT): what the price assumes

In the published model solve dated 2026-Q2, anchored at $50.06, CRANE NXT, CO. (CXT) is priced for +5.0% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-09-07 · Exported: 2026-09-09 · Source: https://boothcheck.com/report/CXT

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 8.4% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 6.5%); the inversion above states its own rate.

Per-Model Detail (n=11)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

• Crane NXT is two businesses of almost equal size: payment and currency-handling equipment on one side, and banknote production plus authentication technology on the other, and the annual report warns that the second half is subject to significant variability due to the timing and size of contract awards by central banks for banknote production and actual order rates, particularly with the U.S. government.

• The cost of the recent buying shows up immediately in the March 2026 quarter, where net sales rose to 387.7 million dollars from 330.3 million while operating profit fell to 22.2 million from 37.3 million and interest expense climbed to 17.8 million from 11.5 million.

• Second-quarter results are due August 5, 2026, and the chief executive bought 24,000 shares on June 12, 2026 for about 1.01 million dollars.

Bull Case

Price the company against last year's profit and the market appears to be asking for something improbable: roughly 23 times trailing operating profit, which works out to operating profit compounding at about 15.3% a year for five years. For a manufacturer of coin validators and currency paper that would be a heroic assumption. Then look at what the top line actually did last quarter. Net sales came in at 387.7 million dollars against 330.3 million a year earlier, growth of roughly 17%. The demanded rate is not a fantasy about a mature business. It is roughly what the business is currently doing, because management went out and bought it.

What they bought matters more than that they bought. During 2025 the company drew $532 million on term loans to fund the De La Rue and Antares acquisitions, folding the acquired operations into a unit that now trades under the name Crane Authentication inside the Security and Authentication Technologies segment, alongside a detection and traceability line that provides electronic equipment and associated software that leverage extensive proprietary capabilities across detection and inspection technologies for applications including the verification and authentication of payment transactions. That is the reframe worth holding onto. A company whose historic identity was cash handling has spent two years converting itself into a company that proves things are genuine, whether the thing is a banknote, a pharmaceutical package or a payment. The second market does not depend on how often people reach for paper money.

The underlying engine is genuinely profitable while this happens. Revenue of 1.71 billion dollars produces roughly 350 million dollars of EBITDA and about 246.6 million dollars of free cash flow, and the return on a book value of 21.39 per share runs near 10.5%. More telling, the share count has not moved at all across the past four years. Two significant acquisitions were financed without asking existing holders for a dollar, which means the upside from integrating them accrues to the same shares that existed before.

Against its industrial peer set the profitability is respectable and the ambition is visible. Crane NXT converts about 12.1% of revenue into operating profit, which puts it alongside TKR at 12.1% and near ESAB at 13.5%, comfortably ahead of HLIO at 9.0% and KMT at 9.4%. The relevant target, though, sits on the other side of the portfolio: specialty instrument businesses like AME at 25.9% and IEX at 20.7% show what a differentiated authentication and detection franchise earns once it is integrated and scaled. Bulls are underwriting the distance between 12% and something with a two in front of it.

One more data point, small and hard to fake. On June 12, 2026 the chief executive bought 24,000 shares in the open market for roughly 1.01 million dollars. Executives sell for many reasons and buy for essentially one.

Bear Case

In twelve months the company roughly doubled the size of its debt. The annual report records that Total debt was $1,139.5 million and $750.6 million as of December 31, 2025, and 2024, respectively, and the balance has grown again since, with borrowings now near 1.51 billion dollars gross against 228.3 million of liquid assets. The money went into acquisitions, not into the existing business, which means the interest is certain and the returns are forecast.

The stress test is not hypothetical. It already ran, in the most recent filed quarter. For the three months ended March 31, 2026, net sales rose about 17% to 387.7 million dollars while operating profit fell to 22.2 million from 37.3 million, and interest expense rose to 17.8 million from 11.5 million. Set those last two side by side: in that quarter the operating business earned barely more than the interest on its own borrowings. The trailing coverage figure of roughly three times describes a company that no longer quite exists, because the trailing period contains quarters before the debt was drawn and the acquired cost base arrived.

What has to fund all of it is lumpy by nature. Half the revenue sits in a segment whose results, in the company's own words, are subject to significant variability due to the timing and size of contract awards by central banks for banknote production and actual order rates, particularly with the U.S. government. A government deciding to defer a currency order does not reduce revenue gradually; it removes a contract. Leverage taken against smooth cash flow is one thing. Leverage taken against a procurement calendar is another.

Integration is consuming real money on top of that. The company recorded $12.1 million of restructuring expense in the SAT segment, predominantly related to severance charges, associated with the integration of the DLR and OpSec businesses, and further acquisition-related costs are running through selling and administrative expense in the current year. Those charges are the reason a 17% sales increase produced a 40% profit decrease, and they are, by the bull's own argument, temporary. The bear's question is simply how many quarters of temporary a balance sheet at this size can absorb.

Underneath sits the slower problem. The historic core sells equipment that counts, validates and moves physical currency, and the long-run direction of physical currency use in developed markets is not favourable. The company is buying its way out of that exposure, which is the correct response, but each purchase adds goodwill to the balance sheet and interest to the income statement while the payoff stays in the forecast. That is why the asset-based and earnings-power approaches both stop well short of today's price, at something near half of it: the first sees a book value increasingly composed of what was paid for other companies, and the second sees the profit those companies are currently producing. Today's price requires operating profit to compound near 15.3% a year for five years, a pace that only about 44% of comparable fast growers held for that long, and the multiple already sits in the upper half of its peer group before any of it is delivered.

Valuation

Two things about the price are worth separating. The market values the enterprise at roughly 23 times trailing operating profit, and at about 12.6 times EBITDA, the level the exit-multiple cash-flow method holds flat rather than compressing into its terminal year. The first number looks demanding for an industrial manufacturer. The second looks ordinary. The difference between them is depreciation, amortization of recently acquired intangibles, and the restructuring charges of a company mid-integration.

Inverted, the price asks for company-wide operating profit to compound at roughly 15.3% a year for about five years, from a business currently converting about 12.1% of revenue into operating profit. That solve is computed at an 8.47% cost of capital and moves substantially with it: a percentage point on the discount rate shifts the implied growth demand by something like seven and a half points, so the figure is a direction rather than a measurement. The direction is that the price has already credited the acquisitions with working.

The methods divide along exactly that line. Peer-multiple approaches sit close to today's price and the forward cash-flow approach reaches it. The earnings-power approaches and the book-value approaches settle near half of it. The earnings-power gap has a specific and honest cause: those methods capitalize normalized operating profit with no growth credited at all, which is the correct way to value a business that has stopped changing and the wrong way to value one that has just absorbed two acquisitions. The asset-based gap has a different cause, namely that a growing share of the book is goodwill created by paying for other companies.

The cohort places the premium precisely. Crane NXT's 12.1% operating margin sits mid-pack among diversified industrials: TKR at 12.1%, ESAB at 13.5%, GTES at 13.1%, with CW at 18.4% above and HLIO at 9.0% below. On the instrument and detection side of the comparison, AME converts 25.9% and IEX 20.7%. The multiple this company carries sits in the upper half of its peer range while the margin sits in the middle of it, which is a coherent position only if the second number is heading toward the specialty group rather than staying with the general one.

Solvency is where the timing risk concentrates. Net borrowings of roughly 1.28 billion dollars stand at about 6.76 times operating profit, and liquid assets run near 228.3 million. The trailing interest coverage of about 3.1 times is real but backward-looking; in the March 2026 quarter operating profit of 22.2 million covered interest of 17.8 million and not much else. Set against that, the share count has been flat for four years, so nothing about the risk has been transferred to existing holders through dilution. The entire bet was financed with borrowed money, which is the cleanest possible description of where a disappointment would land first.

Catalysts

Second-quarter results arrive on August 5, 2026, with the date announced on July 9, 2026. It is the first full quarter with Antares Vision inside the reported numbers, which makes it the first clean look at what the acquired revenue costs to run.

The March quarter, reported on May 7, 2026, was the transition print: the Antares Vision acquisition completed, sales up sharply, and profit down on integration and restructuring charges. Management left its full-year outlook in place at that report rather than trimming it, which sets a specific and checkable expectation for the second half. The segment reporting also began separating a detection and traceability line, so the next several prints will show, for the first time, whether authentication and traceability carry the margins that justified buying them.

On June 12, 2026 chief executive Aaron Saak purchased 24,000 shares in the open market for approximately 1.01 million dollars. Coming weeks after a quarter in which reported profit fell by 40%, the timing is the informative part: it is a bet by the person with the most detailed view of the integration schedule that the current earnings depression is a phase rather than a level.

Peer Cohorts (Per Segment, With Filing Citations)

Crane Payment Innovations (reported)

• GTES (Gates Industrial Corporation plc)
• FY2025 10-K: …presented in Note 15 to the consolidated financial statements included elsewhere in this annual report. Debt issuances and redemptions On June 4, 2024, we entered into an amendment to our credit agreement governing our term loans and our secured revolving credit facility. As part of this amendment, we upsized the…
• FY2025 10-K: …The redemption of our Dollar Senior Notes due 2026 resulted in the accelerated recognition of $2.6 million of deferred issuance costs (recognized in interest expense). In July 2025, we made a voluntary principal debt repayment of $100.0 million against our 2022 Dollar Term Loans. As a result of this repayment, we…
• HLIO (HELIOS TECHNOLOGIES, INC.)
• FY2025 10-K: …for diverse end markets, including construction, material handling, agriculture, industrial, mobile, energy, recreational vehicles, marine and health and wellness. We operate under two business segments: Hydraulics and Electronics. The Hydraulics segment designs and manufactures hydraulic motion control and fluid…
• FY2025 10-K: …Joyonway, i3PD and Cygnus Reach brands. Financial information about our business segments is presented in Note 16 of the Notes to the Consolidated Financial Statements. Hydraulics We classify the key technologies within our Hydraulics segment into two categories based on Hydraulic system architecture: motion control…
• RRX (REGAL REXNORD CORP)
• FY2025 10-K: …automation products that include controls, actuators, drives, and high-precision servo motors. The Company recognizes revenue when control of the product passes to the customer or the service is provided. Revenue is recognized at an amount that reflects the consideration expected to be received in exchange for such…
• FY2025 10-K: …growth markets, expanding the industrial powertrain offering, supporting rising demand for greater energy efficiency, and/or leveraging digital capabilities to enhance our products' performance and ease-of-use. • Leveraging Regal Rexnord's unrivaled scale and scope to enable unique customer value-propositions. We…
• TKR (TIMKEN CO)
• FY2025 10-K: …and oscillating movements in a variety of applications and end-markets including aircraft controls, packaging equipment, off-highway equipment, heavy truck, performance auto racing, robotics and many more. Various combinations of material pairs and engineered coatings improve friction management for application…
• FY2025 10-K: …Warranties: The Company provides limited warranties on certain of its products. The Company accrues liabilities for warranties generally based upon specific claims and in certain instances based on historical warranty claim experience in accordance with accounting rules relating to contingent liabilities. When the…
• KMT (KENNAMETAL INC)
• FY2025 10-K: …control transfers to the customer. As a result, revenue is generally recognized at a point in time - either upon shipment or delivery - based on the specific shipping terms in the contract. The shipping terms vary across all businesses and depend on the product, customary local commercial terms and the type of…
• FY2025 10-K: …with customers typically relate to the manufacturing of products, which represent single performance obligations that are satisfied when control of the product passes to the customer. The Company considers the timing of right to payment, transfer of risk and rewards, transfer of title, transfer of physical possession…
• ESAB (ESAB Corporation)
• FY2025 10-K: …provide additional opportunities for growth in the future. Our principal markets outside the United States are Europe, Asia Pacific, South America and the Middle East. Our international operations subject us to certain risks. See Item 1A. "Risk Factors - Risks Related to Our Business -The majority of our sales are…
• FY2025 10-K: …projects consists of a single performance obligation and is recognized at a point in time. As mentioned above, a majority of revenue recognized by the Company relates to contracts with customers for standard or off-the-shelf products. As control typically transfers to the customer upon shipment of the product in…
• CW (CURTISS-WRIGHT CORPORATION)
• FY2025 10-K: …trends in our current and target markets; (b) develop and manufacture competitive products, systems, and services; (c) enhance our offerings by adding technological innovations that differentiate our products, systems, and services from those of our competitors; and (d) develop, manufacture, and bring those products,…
• FY2025 10-K: …on higher sales, while operating margin was negatively impacted primarily by first year purchase accounting costs associated with our acquisition of I&C Solutions and unfavorable mix. Non-segment operating expense for the year decreased $2 million, or 4%, to $42 million, primarily due to lower corporate costs in the…

Security and Authentication Technologies (reported)

• ROK (Rockwell Automation, Inc.)
• FY2025 10-K: …could have an adverse impact on sales, harm our reputation, and cause us to incur legal liability and increased costs to address such events and related security concerns. 6 Table of Contents Product and Services Security Our hardware and software products, services and solutions are used by our customers in…
• FY2025 10-K: …customers' manufacturing environment, and in our enterprise infrastructure. Despite the implementation of security measures, our systems are vulnerable to unauthorized access by nation states, hackers, cyber-criminals, malicious insiders, and other actors who may engage in fraud, theft of confidential or proprietary…
• PH (PARKER-HANNIFIN CORPORATION)
• FY2025 10-K: …third parties. The security and functionality of these information technology systems, and the processing of data by these systems, are critical to our business operations. If these systems, or any part of the systems, are damaged, intruded upon, attacked, shutdown or cease to function properly (whether by planned…
• FY2025 10-K: …We employ enhanced security measures for operational technologies and secure account management, including a secondary anti-malware solution to our existing software to bolster our company-wide defenses. Additionally, we utilize third-party security monitoring services to further improve our 24/7 monitoring…
• FLS (FLOWSERVE CORP)
• FY2025 10-K: …power consumption, reduce carbon emissions, improve plant productivity and reliability, and provide operational cost savings. Digitization We are leveraging technology and data to improve our, and our customers', operations. With a goal of digitizing our existing installed base and new original equipment, we focus on…
• FY2025 10-K: …new and improved products and services depends on their initial and continued acceptance by our customers. Our businesses are affected by varying degrees of technological change and corresponding shifts in customer demand, which result in unpredictable product transitions, shortened life cycles and increased…
• XYL (Xylem Inc.)
• FY2025 10-K: …certain of our 17 customers; disrupting production, supply chain, shipments, billing, collections and customer service; disrupting data analytics or remote monitoring and control of operational systems; enabling unauthorized access, disclosure, misappropriation, misuse, destruction, compromise, or theft of our…
• FY2025 10-K: …data breaches, or other disruptions of information technology systems on which we or our customers rely, or involving our connected products and services; lack of availability or delays in receiving parts and raw materials from our supply chain, including semiconductors or other key components; operational…
• IEX (IDEX CORP)
• FY2025 10-K: …offerings, and an increase in remote and hybrid workforce populations. Additionally, some of our products contain computer hardware and software and offer the ability to connect to computer networks. Our customers, including government customers, are also requiring cybersecurity protections and mandating…
• FY2025 10-K: …The interpretation and enforcement of existing and new laws and regulations regarding privacy, data protection and data security are continuously evolving and there is significant uncertainty with respect to how compliance with these laws and regulations may develop and the costs and complexity of future compliance.…
• EMR (EMERSON ELECTRIC CO.)
• FY2025 10-K: …sustainability and safety. The Discrete Automation segment includes solenoid valves, pneumatic valves, valve position indicators, pneumatic cylinders and actuators, air preparation equipment, pressure and temperature switches, electric linear motion solutions, programmable automation control systems and software,…
• FY2025 10-K: …to cybersecurity threats and other electronic security breaches. It is possible for such vulnerabilities to remain undetected for an extended period. In addition, it is possible a security breach could result in theft of trade secrets or other intellectual property or disclosure of confidential customer, supplier or…
• AME (AMETEK, Inc.)
• FY2025 10-K: …Additionally, we strive to protect health and safety in every aspect of our enterprise - from the way we design, manufacture and deliver our products to the way our customers use them. We continue to drive towards our goal of zero lost-time work incidents. In 2025, we achieved a lost-time incident rate that was…
• FY2025 10-K: …could be adversely impacted by a significant disruption in, or breach in security of, our information technology systems. We rely on information technology systems, some of which are managed by third-parties, to process, transmit and store electronic information (including sensitive data such as confidential business…
• DOV (DOVER Corp)
• FY2025 10-K: …cloud-based systems and managed service providers, to store, process and protect our information and support our business activities. We also use third party systems to support employee data processing for our global workforce and to support customer business activities, such as transmitting payment information,…
• FY2025 10-K: …and trade volumes; an increased global focus on digitization and automation in industrial processes; increasing requirements for sustainability, safety, energy efficiency and consumer product safety; and growth of the middle class and consumption in emerging economies. • Our Engineered Products segment is…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.