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Spirit AeroSystems (SPR) Q4 Earnings Miss, Revenues Up Y/Y

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Spirit AeroSystems Holdings, Inc. (SPR - Free Report) reported fourth-quarter 2019 adjusted earnings of 79 cents per share, which lagged the Zacks Consensus Estimate of $1.57 by 49.7%. The bottom line also plunged 57% from the year-ago quarter’s $1.85.

Barring one-time adjustments, the company reported GAAP earnings of $1.68 per share compared with $1.07 in the year-ago quarter.

For 2019, Spirit AeroSystems’ earnings came in at $5.54 per share, which declined 12% from the prior year’s $6.26.

Highlights of the Release

Total revenues of $1,959 million exceeded the Zacks Consensus Estimate of $1,926 million by 1.7%. Moreover, the top line rose 7% on a year-over-year basis.

Backlog at the end of fourth-quarter 2019 was $43 billion compared with $48 million at the end of fourth-quarter 2018.

For 2019, Spirit AeroSystems generated revenues of $7,863 million, which improved 9% from the prior year’s $7,222 million.

Segment Performance

Fuselage Systems: Revenues at the segment grew 1.7% to $1,034.5 million from $1017.4 million in fourth-quarter 2018. Higher production volumes of the Boeing 787 and increased GCS&S activities drove the top line.

Operating margin for the fourth quarter of 2019 decreased to 5.8% compared with 15.6% during the same period in 2018.

Propulsion Systems: The segment recorded revenues of $532.3 million in the reported quarter, up 20.2% from $442.9 million a year ago. The uptick can be attributed to higher production volumes of the Boeing 737, 777 and Airbus A220 programs as well as a favorable model mix on the Boeing 737 program.

Operating margin for the fourth quarter of 2019 increased to 18.7% compared with 18% during the same period of 2018.

Wing Systems: Revenues at the segment rose 4.4% to $390.9 million from $374.4 million in the prior-year quarter. The uptick can be attributed to higher production volumes of the Boeing 787 and Airbus A350 programs.

Operating margin for the fourth quarter of 2019 decreased to 10% compared with 16.1% during the same period of 2018.

Spirit Aerosystems Holdings, Inc. Price, Consensus and EPS Surprise

Operational Highlights

Total operating expenses rose 17.1% year over year to $1,863.6 million on account of higher cost of sales; increased selling, general and administrative expenses; and elevated research and development expenses.

The company’s operating income plunged 60.7% in the fourth quarter to $95.7 million from the year-ago quarter’s $243.6 million.

Financial Position

As of Dec 31, 2019, Spirit AeroSystems had $2,350.5 million in cash and cash equivalents compared with $773.6 million as of Dec 31, 2018.

At the end of 2019, long-term debt (excluding current portion) totaled $2,984.1 million compared with $1,864 million at the end of 2018.

Cash flow from operating activities increased to $922.7 million at the end of 2019 from $$769.9 million at the end of 2018.

Capital expenditures summed $232 million in 2019 compared with $271 million in the prior year.

Zacks Rank

Spirit AeroSystems has a Zacks Rank #5 (Strong Sell).

Recent Defense Releases

Teledyne Technologies Inc. (TDY - Free Report) , a Zacks Rank #3 (Hold) company, reported fourth-quarter 2019 adjusted earnings of $2.90 per share, which surpassed the Zacks Consensus Estimate of $2.76 by 5.1%. The bottom-line figure came above the guided range of $2.71-$2.76 for the reported quarter. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Lockheed Martin Corp. (LMT - Free Report) , a Zacks Rank #3 company, reported fourth-quarter 2019 earnings of $5.29 per share, which surpassed the Zacks Consensus Estimate of $4.99 by 6%. The bottom line also improved 20.5% from $4.39 in the year-ago quarter.

General Dynamics Corporation’s (GD - Free Report) , a Zacks Rank #3 company, reported fourth-quarter earnings from continuing operations of $3.51 per share, which beat the Zacks Consensus Estimate of $3.46 by 1.45%.

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