Updated 3/10/25
Gorman-Rupp (NYSE: GRC) isn’t the flashiest stock on the market, but for investors who value steady income and reliability, it has a lot to offer. The company has been in the business of manufacturing pumps and fluid control systems since 1933, serving industries that include water, wastewater, and various industrial sectors.
This isn’t a stock that’s going to skyrocket overnight, but that’s not why dividend investors are drawn to it. Gorman-Rupp is all about stability, consistent cash flow, and a commitment to rewarding shareholders with reliable dividend payments. With a history of steady growth and financial discipline, it’s worth taking a closer look at what makes this company a solid choice for income-focused investors.
📊 Key Dividend Metrics
💰 Dividend Yield: 1.93%
💵 Annual Dividend: $0.74 per share
🔄 5-Year Average Yield: 2.02%
🔺 Dividend Growth: Strong track record of increases
🏆 Payout Ratio: 47.39% (Healthy and sustainable)
📅 Next Dividend Date: March 10, 2025
⚖ Ex-Dividend Date: February 14, 2025
Dividend Overview
Gorman-Rupp’s dividend yield sits at 1.93%, which isn’t sky-high, but that’s not the main appeal here. What makes it stand out is consistency. The company has been paying dividends for decades, steadily rewarding shareholders while maintaining financial stability.
A key factor in its reliability is the payout ratio, currently at 47.39%. This means the company is paying out less than half of its earnings as dividends, leaving plenty of room to reinvest in the business while keeping shareholders happy. For income investors looking for security rather than speculation, this level of balance is ideal.
Dividend Growth and Safety
Gorman-Rupp isn’t just paying dividends—it’s increasing them. A history of annual dividend hikes signals a commitment to shareholders that isn’t just talk.
Why does this matter? Because companies that grow their dividends over time tend to be financially disciplined, ensuring they don’t overextend themselves. And with a moderate payout ratio and solid cash flow, Gorman-Rupp looks well-positioned to continue this trend.
There’s also a level of business stability here that makes the dividend safe. The company operates in an industry that’s essential—municipalities and industrial businesses will always need pumps and fluid management systems. That demand gives Gorman-Rupp a steady revenue stream, even when the broader economy slows down.
Chart Analysis
Price Movement and Trend
The stock has been fluctuating between the mid-$30s and low-$40s, with some noticeable spikes and pullbacks over the past year. The 50-day moving average (light blue) has been tracking above the 200-day moving average (dark blue) for a good portion of the chart, signaling periods of bullish momentum. However, more recently, the 50-day MA has started to converge with the 200-day MA, which can indicate a shift in trend or a consolidation phase.
Looking at the past few months, there was a clear uptrend through mid-to-late 2024, followed by a more turbulent period where the stock lost momentum, dipped, and then attempted to stabilize. The latest price action suggests a possible base forming around the $38 range, with the stock closing at $38.30 after hitting a low of $37.67.
Support and Resistance Levels
The $37–$38 range appears to be acting as a support zone, with multiple price rejections in that area over the past few weeks. On the upside, the $40–$42 range has acted as a resistance level, with the stock struggling to maintain gains above those levels.
If the stock can break above its recent highs around $39–$40, there could be another push toward the previous peak near $43.79. However, if it fails to hold support around $37, the next major downside target would likely be in the $35 zone, which has provided support in the past.
Volume and Momentum
Trading volume remains relatively low outside of a few noticeable spikes, including a large volume surge in July, which was followed by a strong upward move. Recently, volume has been stable but not aggressive, indicating lack of strong conviction from either buyers or sellers.
Momentum indicators, such as the Relative Strength Index (RSI) at the bottom of the chart, show that the stock is hovering in a neutral range. The RSI does not indicate overbought or oversold conditions, meaning there isn’t an extreme sentiment shift happening at the moment.
Moving Averages and Technical Signals
The 50-day moving average has dipped below the 200-day moving average in recent weeks, which is often considered a bearish signal if it continues downward. However, the stock is trying to stabilize near these moving averages, suggesting that a break in either direction could determine the next trend.
If the price can move back above both moving averages and hold, that would reinforce bullish strength. On the other hand, if it continues to trade below the moving averages, it could suggest a more extended consolidation phase or even a new downtrend forming.
Analyst Ratings
📊 Upgrades
🔼 February 7, 2022 – Sidoti & Co. upgraded GRC from neutral to buy. The upgrade was driven by the company’s consistent financial performance and positive growth outlook. Analysts cited strong cash flow, stable revenue streams, and an increasing demand for industrial pumping solutions as key reasons for the improved rating.
📉 Downgrades
🔽 November 16, 2021 – Sidoti & Co. downgraded GRC from buy to neutral. The downgrade was largely attributed to valuation concerns, as the stock had already appreciated significantly and was viewed as fairly priced. Analysts suggested that unless GRC could demonstrate stronger-than-expected earnings growth, upside potential in the near term was limited.
📈 Consensus Price Target
💰 Analysts have set an average one-year price target of 53.00, with estimates ranging from 50.00 to 56.00. This suggests that analysts expect moderate upside potential from current price levels, driven by stable earnings and industry demand.
While analyst ratings provide useful insights, they are just one piece of the investment puzzle. Investors should consider broader market conditions, company fundamentals, and their own financial goals before making decisions.
Earnings Report Summary
Gorman-Rupp wrapped up the fourth quarter with steady financial performance, showing slight growth in key areas. Revenue for the quarter came in at $162.7 million, edging up from $160.57 million in the same period last year. While not a massive jump, it’s a sign of consistent demand for the company’s products. Net income also saw an improvement, rising to $10.98 million from $8.98 million a year ago, helping to lift earnings per share from $0.34 to $0.42.
For the full year, revenue reached $659.67 million, a modest 1.3 percent increase over the previous year. While growth wasn’t explosive, the company maintained a solid operating margin of 13.36 percent and a profit margin of 6.08 percent, keeping things stable despite economic uncertainties. Gorman-Rupp’s return on assets came in at 6.41 percent, and return on equity hit 11.09 percent, both reasonable numbers that suggest the company is putting its resources to good use.
On the balance sheet, Gorman-Rupp reported $24.28 million in cash at the end of the year, though total debt stood at $387.27 million, leading to a debt-to-equity ratio of 103.6 percent. While that debt load is on the higher side, the company’s current ratio of 2.52 indicates it has more than enough short-term assets to cover its obligations, which should give investors some peace of mind.
In terms of shareholder returns, Gorman-Rupp continued its long-standing tradition of rewarding investors with dividends. In January 2025, the company declared a quarterly cash dividend of $0.185 per share, further reinforcing its commitment to income-focused investors.
All in all, the latest earnings report painted a picture of slow but steady growth, with a focus on maintaining strong financial health and continuing to return capital to shareholders. The company isn’t delivering eye-popping revenue increases, but its ability to consistently generate profit and keep dividends flowing makes it a reliable choice for long-term investors.
Financial Health and Stability
A strong dividend is only as good as the financials supporting it. The good news is that Gorman-Rupp has a stable foundation, even though there are some areas to watch.
Revenue stands at $659.67 million, with year-over-year growth of 1.3%. While that’s not a huge increase, it’s enough to maintain steady operations. More importantly, operating cash flow comes in at $69.83 million, which is a good sign that the company can comfortably cover its dividend payments.
One area that needs monitoring is debt. Gorman-Rupp has a debt-to-equity ratio of 103.6%, which is a bit higher than what you’d ideally like to see. While it’s not a major red flag, it does mean the company has to be careful about interest costs, especially if rates remain high.
That being said, with a current ratio of 2.52, the company has more than enough short-term assets to cover liabilities. In other words, while debt is something to keep in mind, it’s not at a level that would threaten dividends in the near future.
Valuation and Stock Performance
At a price of $38.27, Gorman-Rupp isn’t trading at a bargain, but it’s also not in overpriced territory. The trailing P/E ratio sits at 25.03, while the forward P/E is 19.34—showing that the stock is valued reasonably for an industrial company with steady earnings.
Looking at historical performance, the stock has been relatively stable:
- 52-week high: $43.79
- 52-week low: $30.47
- 50-day moving average: $37.96
- 200-day moving average: $38.38
Gorman-Rupp has been moving within a fairly predictable range, which reflects its steady, rather than explosive, nature. Investors looking for dramatic price swings or high volatility won’t find it here. Instead, it’s a stock that moves in line with fundamentals, making it a lower-risk option for income-focused portfolios.
Risks and Considerations
Every investment comes with risks, and while Gorman-Rupp is relatively stable, there are a few areas investors should keep in mind.
Debt Levels
The company’s debt-to-equity ratio of 103.6% is higher than ideal, meaning a portion of its earnings will need to go toward debt payments. As long as cash flow remains strong, this shouldn’t be a problem, but it’s something to watch, especially if borrowing costs stay high.
Slower Revenue Growth
With revenue growth at just 1.3% year over year, Gorman-Rupp isn’t expanding at a rapid pace. While that’s not a major concern for a dividend stock, it does limit how quickly the company can increase payouts in the future. Investors expecting strong dividend growth may find the pace a bit slow.
Dependence on Industrial and Municipal Budgets
A significant portion of Gorman-Rupp’s business comes from municipalities and industrial clients. If government budgets tighten or industrial spending slows, it could impact demand for the company’s products. However, given that infrastructure spending is often prioritized, this is a lower-risk concern.
Valuation Considerations
The stock is fairly valued but not a deep bargain. Investors buying at current levels should expect steady returns rather than a big upside surprise.
Final Thoughts
Gorman-Rupp is the kind of stock that appeals to investors who appreciate stability. It’s not flashy, but it delivers where it counts—consistent dividends, a strong financial foundation, and a reliable track record.
For those looking for high yield, this might not be the first choice. But for investors who value slow, steady dividend growth with minimal drama, it’s a solid option to consider. As long as the company continues to manage debt and maintain steady cash flow, its dividend should remain a dependable source of income for years to come.
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