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Woodward (WWD) Q1 Earnings Miss Estimates, Revenues Up Y/Y
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Woodward, Inc. (WWD - Free Report) reported net earnings of 49 cents per share for the first quarter of fiscal 2023, which missed the Zacks Consensus Estimate by 18.3%. In the year-ago quarter, the company reported net earnings and adjusted net earnings of 47 cents and 56 cents, respectively.
Net sales in the fiscal first quarter moved up 14% year over year to $619 million due to higher sales in the Aerospace and Industrial segments. The top line beat the consensus estimate by 2.8%.
However, ongoing supply-chain and labor disruptions and unfavorable foreign currency exchange rates acted as headwinds.
Aerospace: Net sales were $396 million, up 18% year over year. The upside can be attributed to higher commercial OEM (up 32% year over year) and commercial aftermarket sales (up 47% year over year), resulting from improving passenger traffic and fleet utilization. Continued softness in defense OEM and aftermarket sales due to lower guided weapons sales and supply-chain disruptions were headwinds.
The segment’s earnings were $55 million, up from $51 million in the year-ago quarter. The upside was caused by price realization and higher commercial OEM and aftermarket sales. However, it was partly offset by increasing material and labor costs, supply-chain constraints and the annual incentive compensation.
Industrial: Net sales totaled $223 million, up 9% from the prior-year quarter. Higher marine sales from continued utilization of the in-service fleet and solid industrial turbomachinery sales resulted in this upside partly offset by unfavorable forex movement.
The segment’s earnings were $11 million, down from $24 million in the year-ago quarter, mainly due to net inflationary impacts on material and labor costs and increasing costs due to supply-chain disruptions and training of new hires.
Other Details
Total costs and expenses increased to $586.9 million, up 16.5% year over year. Adjusted EBITDA came in at $71.8 million compared with $84.1 million in the year-ago quarter.
Cash Flow & Liquidity
As of Dec 31, 2022, Woodward had $99.3 million in cash and cash equivalents with $649.1 million of long-term debt (less the current portion).
For the first quarter, Woodward generated $5 million of net cash from operating activities, compared with $39 million a year ago. Adjusted free cash flow for the same period came in at ($19) million compared with $27 million in the prior-year period. The downtick was mainly caused by increased capital expenditures, tax payments and rising supply-chain constraints.
Woodward repurchased shares worth $26 million in the first quarter. In January 2022, the company authorized a new $800 million two-year stock repurchase program, reinforcing its financial position and positive outlook. The company has $328 million remaining under the share repurchase authorization.
The company also announced that its Board of Directors had increased the quarterly dividend from 19 cents to 22 cents per share, which is payable on Mar 7, 2023, to shareholders as of Feb 21.
Fiscal 2023 Overview
For fiscal 2023, net sales are now expected to be between $2.6 billion and $2.75 billion.
The Aerospace segment’s revenues are expected to increase between 14% and 19%, while the Industrial segment’s revenues are expected to remain flat or increase 5%.
Free cash flow is projected to be between $200 million and $250 million. Earnings are likely to be in the range of $3.15-$3.60 per share.
The Zacks Consensus Estimate for Arista Networks 2022 earnings is pegged at $4.38 per share, rising 0.2 in the past 60 days. The long-term earnings growth rate is anticipated to be 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 12.7%. Shares of ANET have increased 1.4% in the past year.
The Zacks Consensus Estimate for Jabil’s 2023 earnings is pegged at $8.37 per share, rising 2.3% in the past 60 days. The long-term earnings growth rate is anticipated to be 12%.
Jabil’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 8.8%. Shares of JBL have increased 25.6% in the past year.
The Zacks Consensus Estimate for Calix’s 2022 earnings is pegged at $1.28 per share, rising 1.5% in the past 60 days.
Calix’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 22.2%. Shares of CALX have soared 1.7% in the past year.
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Woodward (WWD) Q1 Earnings Miss Estimates, Revenues Up Y/Y
Woodward, Inc. (WWD - Free Report) reported net earnings of 49 cents per share for the first quarter of fiscal 2023, which missed the Zacks Consensus Estimate by 18.3%. In the year-ago quarter, the company reported net earnings and adjusted net earnings of 47 cents and 56 cents, respectively.
Net sales in the fiscal first quarter moved up 14% year over year to $619 million due to higher sales in the Aerospace and Industrial segments. The top line beat the consensus estimate by 2.8%.
However, ongoing supply-chain and labor disruptions and unfavorable foreign currency exchange rates acted as headwinds.
Woodward, Inc. Price, Consensus and EPS Surprise
Woodward, Inc. price-consensus-eps-surprise-chart | Woodward, Inc. Quote
Segment Results
Aerospace: Net sales were $396 million, up 18% year over year. The upside can be attributed to higher commercial OEM (up 32% year over year) and commercial aftermarket sales (up 47% year over year), resulting from improving passenger traffic and fleet utilization. Continued softness in defense OEM and aftermarket sales due to lower guided weapons sales and supply-chain disruptions were headwinds.
The segment’s earnings were $55 million, up from $51 million in the year-ago quarter. The upside was caused by price realization and higher commercial OEM and aftermarket sales. However, it was partly offset by increasing material and labor costs, supply-chain constraints and the annual incentive compensation.
Industrial: Net sales totaled $223 million, up 9% from the prior-year quarter. Higher marine sales from continued utilization of the in-service fleet and solid industrial turbomachinery sales resulted in this upside partly offset by unfavorable forex movement.
The segment’s earnings were $11 million, down from $24 million in the year-ago quarter, mainly due to net inflationary impacts on material and labor costs and increasing costs due to supply-chain disruptions and training of new hires.
Other Details
Total costs and expenses increased to $586.9 million, up 16.5% year over year. Adjusted EBITDA came in at $71.8 million compared with $84.1 million in the year-ago quarter.
Cash Flow & Liquidity
As of Dec 31, 2022, Woodward had $99.3 million in cash and cash equivalents with $649.1 million of long-term debt (less the current portion).
For the first quarter, Woodward generated $5 million of net cash from operating activities, compared with $39 million a year ago. Adjusted free cash flow for the same period came in at ($19) million compared with $27 million in the prior-year period. The downtick was mainly caused by increased capital expenditures, tax payments and rising supply-chain constraints.
Woodward repurchased shares worth $26 million in the first quarter. In January 2022, the company authorized a new $800 million two-year stock repurchase program, reinforcing its financial position and positive outlook. The company has $328 million remaining under the share repurchase authorization.
The company also announced that its Board of Directors had increased the quarterly dividend from 19 cents to 22 cents per share, which is payable on Mar 7, 2023, to shareholders as of Feb 21.
Fiscal 2023 Overview
For fiscal 2023, net sales are now expected to be between $2.6 billion and $2.75 billion.
The Aerospace segment’s revenues are expected to increase between 14% and 19%, while the Industrial segment’s revenues are expected to remain flat or increase 5%.
Free cash flow is projected to be between $200 million and $250 million. Earnings are likely to be in the range of $3.15-$3.60 per share.
Zacks Rank & Stocks to Consider
Woodward currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader technology space are Arista Networks (ANET - Free Report) , Jabil (JBL - Free Report) and Calix (CALX - Free Report) . Jabil and Calix currently sport a Zacks Rank #1 (Strong Buy), whereas Arista Networks holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks.
The Zacks Consensus Estimate for Arista Networks 2022 earnings is pegged at $4.38 per share, rising 0.2 in the past 60 days. The long-term earnings growth rate is anticipated to be 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 12.7%. Shares of ANET have increased 1.4% in the past year.
The Zacks Consensus Estimate for Jabil’s 2023 earnings is pegged at $8.37 per share, rising 2.3% in the past 60 days. The long-term earnings growth rate is anticipated to be 12%.
Jabil’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 8.8%. Shares of JBL have increased 25.6% in the past year.
The Zacks Consensus Estimate for Calix’s 2022 earnings is pegged at $1.28 per share, rising 1.5% in the past 60 days.
Calix’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 22.2%. Shares of CALX have soared 1.7% in the past year.