Start here if you're new
what it is
Carpenter makes specialty metals for aircraft, medical devices, energy equipment, and other parts where failure is not an option.
how it gets paid
Last year Carpenter Tech made $2.9B in revenue. Aerospace & defense was the main engine at $1.77B, or 61% of sales.
why it's growing
Revenue grew ~4.3% last year (FY ~$2.9B). Latest quarter revenue ~$725M ballpark (FY÷4)—not $1.5B as consolidated sales. Gross margin ~29.7% can still apply to the same Q.
what just happened
The quarter worked because EPS hit $2.33, above the $2.27 estimate, while margins expanded hard.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
15/100 earnings predictability — expect surprises
50.8x trailing p/e — you're paying up for this one
0.3% dividend yield — cash in your pocket every quarter
16.5% return on capital — respectable for a metals supplier
xvary composite: 65/100 — average
What they do
Carpenter makes specialty metals for aircraft, medical devices, energy equipment, and other parts where failure is not an option.
If your part goes into a jet engine or defense system, you do not casually swap the metal supplier. Aerospace and defense was 61% of fiscal 2025 sales, which tells you Carpenter sits inside programs where requalification takes time and mistakes are expensive. That shows up in pricing power: EBITDA margin rose to 31.2% in the December quarter from 27.6% a year earlier.
How they make money
$2.9B
annual revenue · their business grew +4.3% last year
Aerospace & defense
$1.77B
Medical
$0.38B
Industrial & consumer
$0.35B
Energy
$0.17B
Transportation
$0.12B
Distribution
$0.12B
The products that matter
specialty metals manufacturing
Specialty Alloys
$2.9B revenue · +4.3% growth
it's the whole $2.9B business as presented here, with net margin around the low-20% area on the health panel (~22%). In a materials company, that margin is the point.
~22% net margin
aerospace and defense exposure
High-spec end markets
30% commercial exposure
at least 30% of revenue is tied to commercial aerospace and industrial demand based on the risk disclosure here. That gives you upside in strong cycles and a very real slowdown risk when they weaken.
cycle lever
Key numbers
31.2%
EBITDA margin
EBITDA margin → cash profit before financing and accounting noise → so what: Carpenter converted sales into much fatter profits than last year’s 27.6%.
$459
18-month target
Target price → a published fair-value estimate → so what: it sits 21% above the $379.80 stock price, so upside still exists if earnings keep climbing.
16.5%
Return on capital
Return on capital → profit earned on the money tied up in the business → so what: Carpenter is earning better returns than most industrial companies manage.
50.8x
Trailing P/E
P/E → how many dollars investors pay for $1 of past earnings → so what: you are paying a luxury multiple for a metals company.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 25 / 100
- long-term debt $690M (4% of capital)
- net profit margin 22.3% — keeps 22 cents of every dollar in revenue
- return on equity 16% — $0.16 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in CRS 3 years ago → it's now worth $77,220.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
The quarter worked because EPS hit $2.33, above the $2.27 estimate, while margins expanded hard.
Order-of-magnitude quarter sales ~$725M (vs ~$2.9B FY)—the old $1.5B quarter and 101% vs. prior year did not reconcile to FY +4.3%. Gross margin was 29.7%. Management also said commercial aerospace bookings rose 23% sequentially, which helps explain confidence around fiscal 2026 earnings.
~$725M
quarter revenue (FY÷4)
$2.33
eps
29.7%
gross margin
the number that mattered
The key number was the 31.2% EBITDA margin, because it was 360 basis points above the prior year's 27.6% and shows pricing power is doing real work.
-
carpenter technology is on pace for strong earnings growth in fiscal 2026. (year ends june 30th.) in the december period, the specialty alloy manufacturer's sales, excluding changes in a revenue surcharge to customers for commodity price fluctuations, rose at a healthy 7.5% rate versus the comparable level in the fiscal second quarter of 2025.
-
the top-line gain was on a 4.8% increase in pounds sold, with the remainder of the improvement coming from a combination of product-mix optimization and pricing power.
-
the operating margin (ebitda as a percentage of sales) rose to 31.2%, 360 basis points wider than the 27.6% margin registered in the fiscal second quarter of 2025.
-
bookings for commercial aerospace customers were up 23% sequentially (relative to the fiscal first quarter ended september 30th).
-
the increased orders in this key end market provides good visibility through fiscal year-end.leadership stated that it has ``completed negotiations on several long-term [price and volume] agreements with aerospace customers, with significant value realization.'' this should remove some of the cyclicality from the business.
source: company earnings report, 2026
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What could go wrong
the #1 risk is aerospace and industrial demand rolling over. This is a specialty materials company, but it is still tied to end-market volume.
med
aerospace and industrial slowdown
At least 30% of revenue is tied to commercial aerospace and industrial demand based on this page's own risk framing. If those customers pull back, volume and sentiment can fall together.
A downturn would pressure a meaningful slice of the $2.9B revenue base, not just the stock's multiple.
med
margin normalization
Q4 gross margin hit 30.0%, and the business runs at a 17.2% net margin. Those are strong numbers. They are also the reason investors accepted 50.8x trailing earnings.
If margins slip while revenue only grows +4.3%, the stock can rerate quickly because the valuation cushion is thin.
med
raw material cost pressure
The page already flags titanium and alloy pricing as something to watch. When inputs move against you, specialty producers either pass costs through or eat them. Sometimes both, just slower than investors want.
That shows up first in gross margin, which is the cleanest number supporting the current premium multiple.
A forced reset in demand or margins would hit the exact two metrics supporting the stock today: profit expansion and a market willing to pay 50.8x trailing earnings for it.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
gross margin
30.0% was the quarter's key number. If that starts fading, the premium story fades with it.
trend
EPS growth versus revenue growth
Q4 EPS rose 26% while revenue rose 8%. You want that gap to stay wide for a stock at 50.8x trailing earnings.
risk
raw material costs
Titanium and alloy input costs can squeeze profitability fast if pricing power stops keeping up.
calendar
next earnings print
With earnings predictability at 15 / 100, each quarter matters more than usual. This stock does not trade like a sleepy materials name.
Analyst rankings
short-term outlook
top 20%
momentum score 2 — analysts expect above-average price performance in the year ahead. in human-speak, they still like the tape.
risk profile
average
stability score 3 — the business is not fragile, but the stock can still move around a lot.
chart momentum
average
technical score 3 — no unusual chart signal here beyond a stock already near the top of its range.
earnings predictability
15 / 100
earnings predictability this low means quarterly results can surprise you in either direction. That matters more when the valuation is already stretched.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 312 buyers vs. 267 sellers in 3q2025. total institutional holdings: 49.0M shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$272
$645
$380
current price
$459
target midpoint · +21% from current · 3-5yr high: $450 (+20% · 5% ann'l return)
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