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So far, Lockheed and Raytheon Technologies, both S&P 500 companies, from the Aerospace sector have released their Q1 results for 2022. Impressively both of them came up with better-than-expected earnings. Another of cohort of major aerospace & defense stocks like Textron Inc. (TXT - Free Report) , Northrop Grumman Corp. (NOC - Free Report) and L3Harris Technologies (LHX - Free Report) are set to announce their earnings on Apr 28.
Factors That Influenced Aerospace & Defense Stocks in Q1
A steady recovery witnessed in global air travel, both domestic and international, is expected to have boosted the quarterly performance of the aerospace and defense stocks, particularly those engaged in commercial aviation in the first quarter. Boeing witnessed a solid year-over-year surge of 23.4% in its commercial shipments during the first quarter. We expect the Q1 results of the remaining aerospace majors to reflect a similar improvement in delivery trends, which must have boosted the overall top-line growth of the Aerospace sector.
On the other hand, stocks that are more focused on combat must have also gained as a result of steady government support. Moreover, a steady order flow observed in the past couple of quarters, along with improved deliveries in recent times, buoyed by recovering economic trends are projected to have bolstered Q1 revenues of aerospace and defense stocks.
However, persistent headwinds like supply chain disruption along with a slow pace of cash inflow within the industry might have an adverse impact on the overall Q1 results of some of the industry majors.
Q1 Projections
Aerospace sector Q1 earnings are expected to improve 10.8% from the prior-year quarter’s reported figure, while revenues are projected to slip 0.4%.
For more details on quarterly releases, you can go through the latest Earnings Preview.
Aerospace & Defense Earnings to Watch on Apr 28
Let's take a look at the following aerospace and defense companies that are scheduled to report first-quarter 2022 earnings on Apr 28 and find out how things have shaped up prior to the announcements.
Textron: Recovering trends in commercial aerospace must have bolstered the Textron Aviation segment’s Q1 performance. Increasing volumes from improving OEM auto production are expected to have contributed to the Industrial unit’s growth. However, lower revenues from the military business might have been a drag on the Bell business unit.
Higher products volume, favorable pricing and increased operating leverage are projected to have bolstered its bottom line in the soon-to-be-reported quarter (read more: Will Aviation Recovery Aid Textron's Q1 Earnings?).
Textron has an Earnings ESP of -2.97% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Northrop Grumman: With the majority of NOC’s segments likely to report lower sales, one might remain skeptical about the company’s top line in the soon-to-be-reported quarter. Lower volumes in manned aircraft and autonomous systems might have unfavorably impacted the Q1 revenue performance of the Aeronautic segment. Closing of the contract at the U.S. Army’s Lake City ammunition plant might have negatively impacted Defense Systems’ performance.
Northrop expects its Q1 earnings to benefit from corporate unallocated and pension adjustments.
L3Harris Technologies: While the continued recovery in its commercial aerospace business is expected to have benefited revenues from the Integrated Mission Systems unit in the first quarter, product delivery delays within Tactical Communications, along with the lower volumes of legacy platforms in Broadband Communications, might have dampened communication systems unit’s revenues.
L3Harris Technologies’ earnings are likely to have benefited from merger cost synergies and savings from the e3 (excellence, everywhere, every day) operational excellence program.
Image: Bigstock
Aerospace & Defense Apr 28 Q1 Earnings Roster: TXT, NOC & LHX
So far, Lockheed and Raytheon Technologies, both S&P 500 companies, from the Aerospace sector have released their Q1 results for 2022. Impressively both of them came up with better-than-expected earnings. Another of cohort of major aerospace & defense stocks like Textron Inc. (TXT - Free Report) , Northrop Grumman Corp. (NOC - Free Report) and L3Harris Technologies (LHX - Free Report) are set to announce their earnings on Apr 28.
Factors That Influenced Aerospace & Defense Stocks in Q1
A steady recovery witnessed in global air travel, both domestic and international, is expected to have boosted the quarterly performance of the aerospace and defense stocks, particularly those engaged in commercial aviation in the first quarter. Boeing witnessed a solid year-over-year surge of 23.4% in its commercial shipments during the first quarter. We expect the Q1 results of the remaining aerospace majors to reflect a similar improvement in delivery trends, which must have boosted the overall top-line growth of the Aerospace sector.
On the other hand, stocks that are more focused on combat must have also gained as a result of steady government support. Moreover, a steady order flow observed in the past couple of quarters, along with improved deliveries in recent times, buoyed by recovering economic trends are projected to have bolstered Q1 revenues of aerospace and defense stocks.
However, persistent headwinds like supply chain disruption along with a slow pace of cash inflow within the industry might have an adverse impact on the overall Q1 results of some of the industry majors.
Q1 Projections
Aerospace sector Q1 earnings are expected to improve 10.8% from the prior-year quarter’s reported figure, while revenues are projected to slip 0.4%.
For more details on quarterly releases, you can go through the latest Earnings Preview.
Aerospace & Defense Earnings to Watch on Apr 28
Let's take a look at the following aerospace and defense companies that are scheduled to report first-quarter 2022 earnings on Apr 28 and find out how things have shaped up prior to the announcements.
Textron: Recovering trends in commercial aerospace must have bolstered the Textron Aviation segment’s Q1 performance. Increasing volumes from improving OEM auto production are expected to have contributed to the Industrial unit’s growth. However, lower revenues from the military business might have been a drag on the Bell business unit.
Higher products volume, favorable pricing and increased operating leverage are projected to have bolstered its bottom line in the soon-to-be-reported quarter (read more: Will Aviation Recovery Aid Textron's Q1 Earnings?).
Textron Inc. Price and EPS Surprise
Textron Inc. price-eps-surprise | Textron Inc. Quote
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can see the complete list of today’s Zacks #1 Rank stocks here.
Textron has an Earnings ESP of -2.97% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Northrop Grumman: With the majority of NOC’s segments likely to report lower sales, one might remain skeptical about the company’s top line in the soon-to-be-reported quarter. Lower volumes in manned aircraft and autonomous systems might have unfavorably impacted the Q1 revenue performance of the Aeronautic segment. Closing of the contract at the U.S. Army’s Lake City ammunition plant might have negatively impacted Defense Systems’ performance.
Northrop expects its Q1 earnings to benefit from corporate unallocated and pension adjustments.
Northrop currently has an Earnings ESP of +1.32% and Zacks Rank #3 (read more: Will Soft Segmental Sales Hurt Northrop's Q1 Earnings?).
Northrop Grumman Corporation Price and EPS Surprise
Northrop Grumman Corporation price-eps-surprise | Northrop Grumman Corporation Quote
L3Harris Technologies: While the continued recovery in its commercial aerospace business is expected to have benefited revenues from the Integrated Mission Systems unit in the first quarter, product delivery delays within Tactical Communications, along with the lower volumes of legacy platforms in Broadband Communications, might have dampened communication systems unit’s revenues.
L3Harris Technologies’ earnings are likely to have benefited from merger cost synergies and savings from the e3 (excellence, everywhere, every day) operational excellence program.
L3Harris currently has an Earnings ESP of -0.62% and Zacks Rank #4 (Sell) (read more: Will Supply-Chain Constraint Hurt L3Harris' Q1 Earnings?).
L3Harris Technologies Inc Price and EPS Surprise
L3Harris Technologies Inc price-eps-surprise | L3Harris Technologies Inc Quote
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.