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Shares of Astronics Corporation (ATRO - Free Report) have surged 10.3% in the past three months, outperforming both the Zacks Aerospace-Defense Equipment industry’s decrease of 9.1% and the broader Zacks Aerospace sector’s decline of 4.4%. It also came above the S&P 500’s decline of 5.2% in the same time frame.
Image Source: Zacks Investment Research
Other industry players like Hexcel (HXL - Free Report) and Curtiss-Wright Corp. (CW - Free Report) have also delivered a similar stellar performance in the past three months. Shares of HXL and CW have risen 0.2% and 20%, respectively, in the said period.
With ATRO’s strong performance in the market, many investors may feel encouraged to buy right away. However, before taking that step, it’s important to evaluate whether the company has the fundamental strength to support long-term growth or if the recent surge is temporary. Understanding the stability of ATRO’s growth prospects can help investors make a well-informed decision.
Tailwinds for ATRO
Astronics’ recent performance reflects a combination of solid industry demand, strategic positioning and contract wins. The company is a specialized provider of advanced electrical power, connectivity, lighting and test systems for the global aerospace and defense industry, serving both commercial and military aviation markets. This diversified exposure allows it to benefit from rising defense budgets as well as the continued recovery in global air travel.
Favorable demand trends are supporting growth across its end markets. Increasing defense spending is driving sustained demand for military aircraft, while airlines are investing in cabin upgrades, including in-seat power and in-flight connectivity systems. These trends align well with Astronics’ core offerings. The company secured a contract from Boeing in March 2026 to supply fuel tank access doors for the 737 MAX program, strengthening its long-standing relationship with the aircraft manufacturer and enhancing revenue visibility.
Astronics also benefits from structural advantages such as long product life cycles and high switching costs, which help build durable customer relationships and support recurring revenue streams. With the aerospace industry continuing to recover, these factors provide a solid foundation for long-term growth and margin improvement.
Moreover, management remains focused on improving profitability through cost discipline, supply-chain stabilization and prudent capital allocation. As production volumes increase, the company is expected to gain from operating leverage, leading to gradual margin expansion and improved free cash flow. A strong backlog, particularly within its aerospace segment, further supports visibility into future revenues.
ATRO’s Estimates
The Zacks Consensus Estimate for 2026 sales implies year-over-year growth of 11.6%, while that for 2027 sales indicates an improvement of 7.1%.
The consensus estimate for 2026 earnings implies year-over-year growth of 30.4%, while that for 2027 earnings indicates an improvement of 20%.
Image Source: Zacks Investment Research
Further, the upward revision in its 2026 and 2027 earnings estimates over the past 60 days suggests investors’ increasing confidence in this stock’s earnings generation capabilities.
Image Source: Zacks Investment Research
ATRO Stock Reflects Discounted Valuation
In terms of valuation, ATRO’s forward 12-month price-to-sales (P/S) is 2.59X, a discount to the industry average of 11.73X. This suggests that investors will be paying a lower price than the company's expected sales growth compared with its industry average.
Image Source: Zacks Investment Research
Other industry peers, on the contrary, are trading at a premium to ATRO. While Hexcel is trading at a forward 12-month P/S of 2.77X, Curtiss-Wright is trading at 6.80X.
ATRO’s Liquidity Position
ATRO has a current ratio of 3.10. The ratio, being more than one, indicates that ATRO possesses sufficient capital to pay off its short-term debt obligations.
Hexcel has a current ratio of 5.07, while Curtiss-Wright has a current ratio of 12.52.
ATRO’s ROIC
ATRO’s Return on Invested Capital stands at 17.29%, well above the industry average of 5.80%. This indicates that the company is generating strong returns on its investments and using its capital far more efficiently than most of its peers.
Should You Buy ATRO Stock Now?
Astronics presents an attractive case for investors, supported by its discounted valuation, improving earnings outlook, solid growth forecasts, strong liquidity position and robust performance on the bourses. Thus, investors looking for exposure to the aerospace and defense space may consider buying this stock at current levels.
View the Zacks #1 Rank List
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Astronics Gains 10.3% Over the Past 3 Months: Should You Buy?
Key Takeaways
Shares of Astronics Corporation (ATRO - Free Report) have surged 10.3% in the past three months, outperforming both the Zacks Aerospace-Defense Equipment industry’s decrease of 9.1% and the broader Zacks Aerospace sector’s decline of 4.4%. It also came above the S&P 500’s decline of 5.2% in the same time frame.
Image Source: Zacks Investment Research
Other industry players like Hexcel (HXL - Free Report) and Curtiss-Wright Corp. (CW - Free Report) have also delivered a similar stellar performance in the past three months. Shares of HXL and CW have risen 0.2% and 20%, respectively, in the said period.
With ATRO’s strong performance in the market, many investors may feel encouraged to buy right away. However, before taking that step, it’s important to evaluate whether the company has the fundamental strength to support long-term growth or if the recent surge is temporary. Understanding the stability of ATRO’s growth prospects can help investors make a well-informed decision.
Tailwinds for ATRO
Astronics’ recent performance reflects a combination of solid industry demand, strategic positioning and contract wins. The company is a specialized provider of advanced electrical power, connectivity, lighting and test systems for the global aerospace and defense industry, serving both commercial and military aviation markets. This diversified exposure allows it to benefit from rising defense budgets as well as the continued recovery in global air travel.
Favorable demand trends are supporting growth across its end markets. Increasing defense spending is driving sustained demand for military aircraft, while airlines are investing in cabin upgrades, including in-seat power and in-flight connectivity systems. These trends align well with Astronics’ core offerings. The company secured a contract from Boeing in March 2026 to supply fuel tank access doors for the 737 MAX program, strengthening its long-standing relationship with the aircraft manufacturer and enhancing revenue visibility.
Astronics also benefits from structural advantages such as long product life cycles and high switching costs, which help build durable customer relationships and support recurring revenue streams. With the aerospace industry continuing to recover, these factors provide a solid foundation for long-term growth and margin improvement.
Moreover, management remains focused on improving profitability through cost discipline, supply-chain stabilization and prudent capital allocation. As production volumes increase, the company is expected to gain from operating leverage, leading to gradual margin expansion and improved free cash flow. A strong backlog, particularly within its aerospace segment, further supports visibility into future revenues.
ATRO’s Estimates
The Zacks Consensus Estimate for 2026 sales implies year-over-year growth of 11.6%, while that for 2027 sales indicates an improvement of 7.1%.
The consensus estimate for 2026 earnings implies year-over-year growth of 30.4%, while that for 2027 earnings indicates an improvement of 20%.
Image Source: Zacks Investment Research
Further, the upward revision in its 2026 and 2027 earnings estimates over the past 60 days suggests investors’ increasing confidence in this stock’s earnings generation capabilities.
Image Source: Zacks Investment Research
ATRO Stock Reflects Discounted Valuation
In terms of valuation, ATRO’s forward 12-month price-to-sales (P/S) is 2.59X, a discount to the industry average of 11.73X. This suggests that investors will be paying a lower price than the company's expected sales growth compared with its industry average.
Image Source: Zacks Investment Research
Other industry peers, on the contrary, are trading at a premium to ATRO. While Hexcel is trading at a forward 12-month P/S of 2.77X, Curtiss-Wright is trading at 6.80X.
ATRO’s Liquidity Position
ATRO has a current ratio of 3.10. The ratio, being more than one, indicates that ATRO possesses sufficient capital to pay off its short-term debt obligations.
Hexcel has a current ratio of 5.07, while Curtiss-Wright has a current ratio of 12.52.
ATRO’s ROIC
ATRO’s Return on Invested Capital stands at 17.29%, well above the industry average of 5.80%. This indicates that the company is generating strong returns on its investments and using its capital far more efficiently than most of its peers.
Should You Buy ATRO Stock Now?
Astronics presents an attractive case for investors, supported by its discounted valuation, improving earnings outlook, solid growth forecasts, strong liquidity position and robust performance on the bourses. Thus, investors looking for exposure to the aerospace and defense space may consider buying this stock at current levels.
Astronics currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.