Back to top

Image: Bigstock

Will Segmental Sales Boost AAR Corp. (AIR) Q3 Earnings?

Read MoreHide Full Article

AAR Corp. (AIR - Free Report) is slated to report its third-quarter fiscal 2023 results on Mar 21 after market close.

AAR Corp. has a four-quarter earnings surprise of 3.17%, on average. Its sales across all business segments may continue to grow, benefiting the overall revenues of the company in the fiscal third quarter.

Aviation Services Boasts Strong Revenue Growth

The continuing recovery in commercial passenger air traffic is expected to have aided the top line of the Aviation Services segment in the fiscal third quarter. Improved value-added services to both commercial and government and defense customers are likely to have added impetus to its third-quarter revenues.

The Zacks Consensus Estimate for the Aviation Services segment’s revenues in the fiscal third quarter is pegged at $460.4 million, indicating an improvement of 5.1% from the revenues reported in the year-ago quarter.

Expeditionary Services – a Contributor to Revenues

The higher volumes of mobility products are likely to have continued to grow in the soon-to-be-reported quarter.

The Zacks Consensus Estimate for the Expeditionary Services segment’s revenues in the third quarter is pegged at $21.5 million, indicating year-over-year growth of 51.4%.

AAR Corp. Price and EPS Surprise

AAR Corp. Price and EPS Surprise

AAR Corp. price-eps-surprise | AAR Corp. Quote

Other Factors to Consider

The strong revenue performance across both its segments makes us optimistic about AAR Corp.’s overall revenues in the fiscal third quarter. This, along with the full ramp-up of its new distribution agreements and the increased adoption of used serviceable materials, may have bolstered the top line of the company.

Also, strategies like cost discipline, a mix shift toward parts that boast the highest margin activity and outperformance on certain programs are expected to have aided the margins of the company, thus signifying a strong bottom line in the fiscal third quarter.

Q3 Estimates

The Zacks Consensus Estimate for fiscal third-quarter revenues is pegged at $481.8 million, suggesting growth of 6.6% from the figure reported in the year-ago quarter.

The Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at 68 cents per share, indicating 7.9% growth from the prior-year reported figure.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for AAR Corp. this time. 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. However, that is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

AAR Corp. has an Earnings ESP of 0.00% 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.

Recent Defense Releases

L3Harris Technologies, Inc.’s (LHX - Free Report) fourth-quarter 2022 adjusted earnings from continuing operations came in at $3.27 per share, which beat the Zacks Consensus Estimate of $3.21 by 1.9%. However, the bottom line declined 0.9% from the year-ago quarter’s reported figure.

In the quarter under review, L3Harris’ revenues came in at $4,578 million, beating the Zacks Consensus Estimate of $4,333 million by 5.7%. Revenues rose 5.2% from the year-ago quarter’s $4,350 million.

Textron Inc. (TXT - Free Report) reported fourth-quarter 2022 adjusted earnings of $1.07 per share, which surpassed the Zacks Consensus Estimate of $1.01 by 5.9%. The bottom line also improved by 13.8% from the year-ago quarter’s figure.

Total revenues came in at $3,636 million, which missed the Zacks Consensus Estimate of $3,670.2 million by 0.9%. However, the reported figure increased 9.5% from the year-ago quarter’s $3,322 million.

Raytheon Technologies Corporation’s (RTX - Free Report) fourth-quarter 2022 adjusted earnings per share of $1.27 beat the Zacks Consensus Estimate of $1.24 by 2.4%. Moreover, the bottom line improved 18% from the year-ago quarter’s adjusted earnings of $1.08 per share.

For the full-year 2022, the company reported adjusted earnings of $4.78 per share, which came in 12% higher than the year-ago figure of $4.27. The full-year bottom line also surpassed the Zacks Consensus Estimate of $4.76 per share by 0.4%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Textron Inc. (TXT) - free report >>

AAR Corp. (AIR) - free report >>

L3Harris Technologies Inc (LHX) - free report >>

RTX Corporation (RTX) - free report >>

Published in