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TransDigm Group (TDG) to Post Q4 Earnings: What's in Store?

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TransDigm Group Incorporated (TDG - Free Report) is slated to report fourth-quarter fiscal 2021 results on Nov 16, before market open.

In the last-reported quarter, the company delivered an earnings surprise of 11.37%. Moreover, TransDigm surpassed the Zacks Consensus Estimate in three out of the trailing four quarters and missed the same once, delivering an earnings surprise of 15.03%, on average.

Let’s see how things have shaped up prior to this announcement.

Factors to Consider

TransDigm has been lately observing a slow but steady recovery in the commercial aerospace industry, thanks to expanding vaccination rates along with increased air traffic, especially in certain domestic markets. This must have boosted the company’s commercial aftermarket revenues in the fiscal fourth quarter.

On the other hand, strong order growth is expected to have boosted TransDigm’s defense market revenues in the soon-to-be-reported quarter.

The Zacks Consensus Estimate for fiscal fourth-quarter revenues is pegged at $1.34 billion, indicating an improvement of 13.9% from fourth-quarter fiscal 2020 reported revenues.

Such encouraging revenue projections make us optimistic about TransDigm’s fiscal fourth-quarter earnings. Moreover, the company’s cost-management initiatives are expected to have boosted its quarterly bottom line.

Also, with the integration of the Cobham Aero Connectivity business, following its acquisition by TransDigm this May, positive synergies from this transaction must have contributed favorably to the company’s earnings in the fiscal fourth quarter.

The Zacks Consensus Estimate for earnings stands at $3.72 per share, implying a solid increase of 28.7% from the year-ago quarter’s reported figure.

What the Zacks Model Unveils

Our proven model predicts an earnings beat for TransDigm Group this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: The company’s Earnings ESP is +0.36%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: TransDigm Group carries a Zacks Rank #2 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.

Recent Defense Releases

Curtiss-Wright (CW - Free Report) reported third-quarter 2021 adjusted earnings of $1.88 per share, which surpassed the Zacks Consensus Estimate of $1.80 by 4.4%. Its total sales exceeded the Zacks Consensus Estimate of $601 million by 3.3%.

Curtiss-Wright updated its financial guidance for 2021 and now expects adjusted earnings in the range of $7.20-$7.35 per share, compared with the prior guidance range of $7.15-$7.35 per share. In the past six months, shares of Curtiss-Wright have returned 8.7%.

Raytheon Technologies’ (RTX - Free Report) third-quarter 2021 adjusted earnings per share of $1.26 outpaced the Zacks Consensus Estimate of $1.07 by 17.8%. The company’s third-quarter sales of $16,213 million missed the Zacks Consensus Estimate of $16,494 million by 1.7%.

Raytheon Technologies raised the earnings guidance range for 2021 and tweaked revenue expectations. It currently projects adjusted earnings in the range of $4.10-$4.20 per share, compared with the prior range of $3.85-$4.00. The company expects to record revenues worth approximately $64.50 billion compared with the earlier projection of $64.4-$65.4 billion. In the past six months, shares of Raytheon Technologies have risen 8.2%.

Hexcel Corporation (HXL - Free Report) reported third-quarter 2021 adjusted earnings of 13 cents per share, which outpaced the Zacks Consensus Estimate of 8 cents by 62.5%. Net sales for Hexcel totaled $333.8 million, which missed the Zacks Consensus Estimate of $353 million by 5.3%.

Hexcel continues to withhold its financial guidance citing market uncertainties stemming from the pandemic. The Zacks Consensus Estimate for 2021 has increased 13.6% to 25 cents per share in the past 60 days. Hexcel’s shares have gained 22.1% in the past six months.

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