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TransDigm's (TDG) Q4 Earnings Beat, Up Y/Y on Sales Growth
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TransDigm Group Incorporated (TDG - Free Report) reported fourth-quarter fiscal 2018 adjusted earnings of $4.44 per share, which surpassed the Zacks Consensus Estimate of $4.27 by 4%. Moreover, the bottom line improved 27.6% from $3.48 a year ago.
Barring one-time items, the company reported GAAP earnings of $4.14 per share compared with $2.21 in the year-ago quarter. The year-over-year upside was driven by increase in net sales and lower effective tax rate, owing to the enactment of U.S. Tax Cuts and Jobs Act.
Sales
Net sales amounted to $1,049.4 million, reflecting year-over-year growth of 13.6% from $923.9 million. Further, the reported figure surpassed the Zacks Consensus Estimate of $1,033 million by 1.6%. Organic sales grew 7.7%.
Decent sales growth in commercial aftermarket and defense contributed to the company’s top-line performance in the quarter under review.
Acquisitions
TransDigm frequently acquires proprietary aerospace businesses with significant aftermarket content, which strengthen the company’s foothold in its core market and are in line with its operating strategies. Evidently, on Jul 13, 2018, TransDigm completed the acquisition of Skandia Inc. from Graycliff Partners for approximately $84 million. Notably, Skandia is a leading provider of highly engineered foam, foam fabrication, flammability testing and acoustic solutions for the business jet market.
We expect TransDigm’s acquisition spree to boost its product range with the proprietary products, which enjoy strong position on high use of platforms, robust aftermarket content and an excellent reputation.
Transdigm Group Incorporated Price, Consensus and EPS Surprise
TransDigm ended the fiscal fourth quarter of 2018 with cash and cash equivalents of $2,073 million, up from $650.6 million as of Sep 30, 2017. At the end of the reported quarter, the company’s long-term debt summed $12.5 billion compared with $11.39 billion at the end of September 2017.
Cash from operating activities amounted to $1,022.2 million as of Sep 30, 2018 compared with $788.7 million as of Sep 30, 2017.
Fiscal 2019 Outlook
Transdigm Group announced its 2019 financial guidance. Net sales are anticipated to be in the range of $4,125-4,215 million compared with $3,811 million in fiscal 2018.
Net income from continuing operations is projected in the range of $843-$881 million compared with $962 million in fiscal 2018.
Adjusted earnings per share are expected to be $15.92 to $16.60 per share compared with $17.83 in fiscal 2018.
Spirit AeroSystems Holdings, Inc. (SPR - Free Report) reported third-quarter 2018 adjusted earnings of $1.70 per share, which surpassed the Zacks Consensus Estimate of $1.63 by 4.3%.Total revenues of $1,814 million missed the consensus mark of $1,817 million by 0.2%.
Curtiss-Wright (CW - Free Report) reported third-quarter 2018 adjusted earnings of $1.70 per share, which outpaced the Zacks Consensus Estimate of $1.58 by 7.6%. The company’s revenues of $595.4 million increased 5% year over year.
FLIR Systems’ third-quarter 2018 adjusted earnings of 57 cents per share came in line with the Zacks Consensus Estimate. Its revenues declined 6.4% year over year to $434.9 million.
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TransDigm's (TDG) Q4 Earnings Beat, Up Y/Y on Sales Growth
TransDigm Group Incorporated (TDG - Free Report) reported fourth-quarter fiscal 2018 adjusted earnings of $4.44 per share, which surpassed the Zacks Consensus Estimate of $4.27 by 4%. Moreover, the bottom line improved 27.6% from $3.48 a year ago.
Barring one-time items, the company reported GAAP earnings of $4.14 per share compared with $2.21 in the year-ago quarter. The year-over-year upside was driven by increase in net sales and lower effective tax rate, owing to the enactment of U.S. Tax Cuts and Jobs Act.
Sales
Net sales amounted to $1,049.4 million, reflecting year-over-year growth of 13.6% from $923.9 million. Further, the reported figure surpassed the Zacks Consensus Estimate of $1,033 million by 1.6%. Organic sales grew 7.7%.
Decent sales growth in commercial aftermarket and defense contributed to the company’s top-line performance in the quarter under review.
Acquisitions
TransDigm frequently acquires proprietary aerospace businesses with significant aftermarket content, which strengthen the company’s foothold in its core market and are in line with its operating strategies. Evidently, on Jul 13, 2018, TransDigm completed the acquisition of Skandia Inc. from Graycliff Partners for approximately $84 million. Notably, Skandia is a leading provider of highly engineered foam, foam fabrication, flammability testing and acoustic solutions for the business jet market.
We expect TransDigm’s acquisition spree to boost its product range with the proprietary products, which enjoy strong position on high use of platforms, robust aftermarket content and an excellent reputation.
Transdigm Group Incorporated Price, Consensus and EPS Surprise
Transdigm Group Incorporated Price, Consensus and EPS Surprise | Transdigm Group Incorporated Quote
Financial Position
TransDigm ended the fiscal fourth quarter of 2018 with cash and cash equivalents of $2,073 million, up from $650.6 million as of Sep 30, 2017. At the end of the reported quarter, the company’s long-term debt summed $12.5 billion compared with $11.39 billion at the end of September 2017.
Cash from operating activities amounted to $1,022.2 million as of Sep 30, 2018 compared with $788.7 million as of Sep 30, 2017.
Fiscal 2019 Outlook
Transdigm Group announced its 2019 financial guidance. Net sales are anticipated to be in the range of $4,125-4,215 million compared with $3,811 million in fiscal 2018.
Net income from continuing operations is projected in the range of $843-$881 million compared with $962 million in fiscal 2018.
Adjusted earnings per share are expected to be $15.92 to $16.60 per share compared with $17.83 in fiscal 2018.
Zacks Rank
Transdigm currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Spirit AeroSystems Holdings, Inc. (SPR - Free Report) reported third-quarter 2018 adjusted earnings of $1.70 per share, which surpassed the Zacks Consensus Estimate of $1.63 by 4.3%.Total revenues of $1,814 million missed the consensus mark of $1,817 million by 0.2%.
Curtiss-Wright (CW - Free Report) reported third-quarter 2018 adjusted earnings of $1.70 per share, which outpaced the Zacks Consensus Estimate of $1.58 by 7.6%. The company’s revenues of $595.4 million increased 5% year over year.
FLIR Systems’ third-quarter 2018 adjusted earnings of 57 cents per share came in line with the Zacks Consensus Estimate. Its revenues declined 6.4% year over year to $434.9 million.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6% and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>