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SIFCO Plunges 14.3% in the Past Three Months: How to Play the Stock?
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SIFCO Industries, Inc.'s (SIF - Free Report) investors have been experiencing some short-term losses from the stock of late. Shares of the Cleveland, OH-based manufacturer of forgings, sub-assemblies and machined components (primarily serving the aerospace and energy markets) have plunged 14.3% in the past three months against the industry’s 17.1% rise. The stock also underperformed the sector and the S&P 500’s 8.6% and 2.7% gains, respectively, in the same time frame.
A major development of SIF in recent months includes the announcement of its promising fourth-quarter fiscal 2025 results in December 2025. In the fiscal fourth quarter, the company reported a year-over-year increase in revenue along with a meaningful reduction in losses from continuing operations. Operating performance improved as higher sales volumes and margin expansion helped offset fixed costs, reflecting the benefits of cost-reduction efforts and tighter expense management undertaken during the year.
Management indicated that demand for SIFCO’s forged and machined components remained solid during the quarter, supported by continued activity across aerospace and defense programs. Raw-material availability improved compared with earlier periods, though the company continued to face supply-chain delays, including extended raw-material lead times, which constrained production flow and shipment timing.
SIF’s Three Months Price Comparison
Image Source: Zacks Investment Research
Over the past three months, the stock’s performance has remained weak, underperforming that of its peers like Optex Systems Holdings, Inc (OPXS - Free Report) and Park Aerospace Corp. (PKE - Free Report) . Optex and Park Aerospace’s shares have lost 4.9% and gained 29%, respectively, in the same time frame.
SIFCO specializes in forging, heat-treating, chemical processing and machining services, catering to original equipment manufacturers, Tier 1 and Tier 2 suppliers and aftermarket service providers. These multiple growth drivers reflect robust growth potential.
SIF’s Strong Fundamentals Weigh In
SIFCO’s shares are being supported by steadily improving demand across its core aerospace and defense markets, where activity remained solid through the fiscal year. Management highlighted continued strength in both military and commercial aerospace programs, benefiting from elevated defense spending and a gradual recovery in commercial aircraft production. This backdrop has helped sustain order flow and supported growth in SIF’s backlog, providing better visibility into future revenues.
Another key driver is operational improvement stemming from cost-reduction initiatives and tighter execution. SIF has focused on streamlining operations, selectively adjusting pricing and improving manufacturing efficiency. These efforts have contributed to stronger operating leverage and margin improvement, allowing profitability to improve even without outsized revenue growth — an important signal of structural progress rather than short-term volatility.
Finally, gradual improvement in supply-chain dynamics is contributing to a more stable operating environment. While the company continues to face delays related to raw-material lead times, availability has improved compared with earlier periods. This progress is helping SIFCO better manage production schedules and work through its backlog, supporting a steadier conversion of orders into revenue as operating conditions normalize.
Challenges Ahead for SIFCO
Despite recent improvements, SIFCO continues to face supply-chain challenges, including extended raw-material lead times that can disrupt production schedules and delay shipments. In addition, SIF remains highly dependent on a limited number of large aerospace and defense customers, making results sensitive to order timing, program adjustments or funding changes. Any slowdown or deferral from key customers could weigh on revenue visibility and limit the pace of operating recovery.
SIF Stock’s Valuation
SIFCO’s trailing 12-month EV/Sales of 0.4X is lower than the industry’s average of 15.2X but higher than its five-year median of 0.3X.
Image Source: Zacks Investment Research
Optex and Park Aerospace’s trailing 12-month EV/Sales currently stand at 2.3X and 6.6X, respectively, in the same time frame.
Our Final Take on SIFCO
While SIFCO’s recent share-price decline may raise near-term concerns, the company’s underlying fundamentals remain relatively stable. Demand across its aerospace and defense end markets continues to provide support, while ongoing operational improvements have helped strengthen margins and overall execution. These factors suggest that the recent pullback has been driven more by market sentiment than by a deterioration in core business conditions.
From a valuation standpoint, the stock continues to trade well below industry averages, even after factoring in its recent decline. This discount reflects lingering execution and supply-chain challenges, but it also leaves room for upside if SIFCO can steadily convert backlog into revenue and sustain operational progress.
Given this setup, existing investors may be better served by holding the stock and monitoring execution trends rather than reacting to short-term price weakness. New investors may prefer to wait for clearer evidence of sustained execution, given ongoing supply-chain constraints and the stock’s recent price movement.
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SIFCO Plunges 14.3% in the Past Three Months: How to Play the Stock?
SIFCO Industries, Inc.'s (SIF - Free Report) investors have been experiencing some short-term losses from the stock of late. Shares of the Cleveland, OH-based manufacturer of forgings, sub-assemblies and machined components (primarily serving the aerospace and energy markets) have plunged 14.3% in the past three months against the industry’s 17.1% rise. The stock also underperformed the sector and the S&P 500’s 8.6% and 2.7% gains, respectively, in the same time frame.
A major development of SIF in recent months includes the announcement of its promising fourth-quarter fiscal 2025 results in December 2025. In the fiscal fourth quarter, the company reported a year-over-year increase in revenue along with a meaningful reduction in losses from continuing operations. Operating performance improved as higher sales volumes and margin expansion helped offset fixed costs, reflecting the benefits of cost-reduction efforts and tighter expense management undertaken during the year.
Management indicated that demand for SIFCO’s forged and machined components remained solid during the quarter, supported by continued activity across aerospace and defense programs. Raw-material availability improved compared with earlier periods, though the company continued to face supply-chain delays, including extended raw-material lead times, which constrained production flow and shipment timing.
SIF’s Three Months Price Comparison
Image Source: Zacks Investment Research
Over the past three months, the stock’s performance has remained weak, underperforming that of its peers like Optex Systems Holdings, Inc (OPXS - Free Report) and Park Aerospace Corp. (PKE - Free Report) . Optex and Park Aerospace’s shares have lost 4.9% and gained 29%, respectively, in the same time frame.
SIFCO specializes in forging, heat-treating, chemical processing and machining services, catering to original equipment manufacturers, Tier 1 and Tier 2 suppliers and aftermarket service providers. These multiple growth drivers reflect robust growth potential.
SIF’s Strong Fundamentals Weigh In
SIFCO’s shares are being supported by steadily improving demand across its core aerospace and defense markets, where activity remained solid through the fiscal year. Management highlighted continued strength in both military and commercial aerospace programs, benefiting from elevated defense spending and a gradual recovery in commercial aircraft production. This backdrop has helped sustain order flow and supported growth in SIF’s backlog, providing better visibility into future revenues.
Another key driver is operational improvement stemming from cost-reduction initiatives and tighter execution. SIF has focused on streamlining operations, selectively adjusting pricing and improving manufacturing efficiency. These efforts have contributed to stronger operating leverage and margin improvement, allowing profitability to improve even without outsized revenue growth — an important signal of structural progress rather than short-term volatility.
Finally, gradual improvement in supply-chain dynamics is contributing to a more stable operating environment. While the company continues to face delays related to raw-material lead times, availability has improved compared with earlier periods. This progress is helping SIFCO better manage production schedules and work through its backlog, supporting a steadier conversion of orders into revenue as operating conditions normalize.
Challenges Ahead for SIFCO
Despite recent improvements, SIFCO continues to face supply-chain challenges, including extended raw-material lead times that can disrupt production schedules and delay shipments. In addition, SIF remains highly dependent on a limited number of large aerospace and defense customers, making results sensitive to order timing, program adjustments or funding changes. Any slowdown or deferral from key customers could weigh on revenue visibility and limit the pace of operating recovery.
SIF Stock’s Valuation
SIFCO’s trailing 12-month EV/Sales of 0.4X is lower than the industry’s average of 15.2X but higher than its five-year median of 0.3X.
Image Source: Zacks Investment Research
Optex and Park Aerospace’s trailing 12-month EV/Sales currently stand at 2.3X and 6.6X, respectively, in the same time frame.
Our Final Take on SIFCO
While SIFCO’s recent share-price decline may raise near-term concerns, the company’s underlying fundamentals remain relatively stable. Demand across its aerospace and defense end markets continues to provide support, while ongoing operational improvements have helped strengthen margins and overall execution. These factors suggest that the recent pullback has been driven more by market sentiment than by a deterioration in core business conditions.
From a valuation standpoint, the stock continues to trade well below industry averages, even after factoring in its recent decline. This discount reflects lingering execution and supply-chain challenges, but it also leaves room for upside if SIFCO can steadily convert backlog into revenue and sustain operational progress.
Given this setup, existing investors may be better served by holding the stock and monitoring execution trends rather than reacting to short-term price weakness. New investors may prefer to wait for clearer evidence of sustained execution, given ongoing supply-chain constraints and the stock’s recent price movement.