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Heico (HEI) Q4 Earnings Beat Estimates, Sales Increase Y/Y

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HEICO Corporation’s (HEI - Free Report) fourth-quarter fiscal 2021 earnings per share (EPS) of 62 cents surpassed the Zacks Consensus Estimate of 57 cents by 8.8%. The bottom line improved 37.8% from the prior-year period’s figure of 45 cents.
 
The year-over-year improvement can be attributed to sales and operating income growth witnessed in the fiscal fourth quarter.

During fiscal 2021, the company reported EPS of $2.21, which surpassed the Zacks Consensus estimate of $2.16 by 2.3%. The fiscal bottom line however declined by 3.5% compared with the prior fiscal figure.

Total Sales

The company’s net sales increased 20% year over year to $509.4 million in the reported quarter, primarily driven by consistent recovery observed in the commercial aerospace market industry.

Moreover, total sales beat the Zacks Consensus Estimate of $506 million by 0.8%.

Heico Corporation Price and Consensus

During fiscal 2021, the company generated revenues of $1.87 billion, which surpassed the Zacks Consensus Estimate of $1.86 by 0.5%. The fiscal sales increased 4% from the prior fiscal figure.

Operational Update

HEICO’s total costs and expenses increased 16.7% year over year to $394.4 million in the quarter under review. The increase was due to higher cost of sales, and selling, general and administrative expenses.

Segmental Performance

Flight Support Group: Net sales surged 34% year over year to $260.4 million, driven by enhanced demand for its commercial aerospace products across all product lines and the impact from its profitable fiscal 2021 acquisitions.
 
Operating income soared 126% year over year to $48.6 million on net sales growth and an improved gross profit margin. Further, its operating margin expanded a massive 760 basis points (bps) to 18.7% compared with 11.1% in the prior-year period.

Electronic Technologies Group: The segment’s net sales climbed 7% to $253 million in the quarter under review, driven by organic growth, and benefits from fiscal 2020 and 2021 acquisitions.
 
The segment reported an operating income improvement of 4% year over year to $76.9 million, primarily on net sales growth. However, the company’s operating margin contracted 80 bps to 30.4%.

Financial Details

As of Oct 31, 2021, HEICO’s cash and cash equivalents totaled $108.3 million compared with $406.9 million as of Oct 31, 2020.
 
Cash flow provided by operating activities was $444.1 million at the end of fiscal 2021, reflecting 8.5% growth from the prior-year period.
 
HEICO reported long-term debt (net of current maturities) of $235 million as of Oct 31, 2021, down from $738.8 million as of Oct 31, 2020.

Zacks Rank

HEICO currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other 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 10.3%.

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 year, shares of Raytheon Technologies have risen 18.1%.

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%. Hexcel's net sales 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 2.4% in the past year.

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