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TransDigm (TDG) Q3 Earnings Beat Estimates, FY19 View Raised

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TransDigm Group Incorporated (TDG - Free Report) reported third-quarter fiscal 2019 adjusted earnings of $4.95 per share, which surpassed the Zacks Consensus Estimate of $4.31 by 14.8%. Moreover, the bottom line increased 23.4% from $4.01 registered a year ago.
 
Barring one-time items, the company reported GAAP earnings of $2.57 per share compared with $3.91 in the year-ago quarter.
 
Sales
 
Net sales amounted to $1,658.3 million, reflecting year-over-year surge of 69.1% from $980.7 million in the prior-year quarter. The reported figure also outpaced the Zacks Consensus Estimate of $1,581 million by 4.9%.

Meanwhile, organic sales grew 11.8%. Acquisition sales contributed $561.4 million, of which $545.3 million were from Esterline Technologies Corporation.
 
Financial Position
 
TransDigm ended the third quarter of fiscal 2019 with cash and cash equivalents of $2,716.8 million, up from $2,073 million as of Sep 30, 2018. At the end of the reported quarter, the company’s long-term debt summed $16.5 billion, up from $12.5 billion as of Sep 30, 2018.
 
Cash from operating activities amounted to $768.4 million as of Jun 29, 2019, compared with $690.9 million as of Jun 30, 2018.

Transdigm Group Incorporated Price, Consensus and EPS Surprise

Fiscal 2019 Outlook

TransDigm raised its 2019 financial guidance. Net sales are now anticipated to be $5,500-$5,550 million compared with the prior guidance of $5,395-5,485 million.

EBITDA is anticipated to be $2,425-$2,445 million compared with the prior guidance of $2,325-$2,365 million.

Adjusted earnings per share are currently expected to be $17.93-$18.25 compared with $16.47-$17.15 guided earlier.

Acquisition-related transaction and integration costs were $230 million. GAAP and cash effective tax rate was 24-25%, with an adjusted tax rate of 26.5%.

Zacks Rank
 
TransDigm currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
 
Recent Defense Releases

Textron Inc. (TXT - Free Report) reported second-quarter 2019 earnings from continuing operations of 93 cents per share, which surpassed the Zacks Consensus Estimate of 85 cents by 9.4%. The bottom line also increased 6.9% from 87 cents in the year-ago quarter.

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