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Spirit AeroSystems Down on Dismal Q1 Preliminary Results
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Spirit AeroSystems Holdings, Inc. (SPR - Free Report) recently released its preliminary financial results for first-quarter 2020. The company’s overall revenues and net income in the quarter are expected to take a hit and be significantly lower than the figures posted in the year-ago quarter.
This aircraft parts manufacturer is likely to report first-quarter results on May 6.
Investor’s Confidence Dwindling
Spirit AeroSystems’ recently announced preliminary results have weighed on investor’s confidence in the stock. As a result, share price of this company declined almost 3.2% in the last trading session on Apr 14 to close at $19.99 a share.
Preliminary Numbers in Detail
Per the latest announcement, the company projects revenues of $1,072 million in the first quarter of 2020, which indicates an annual plunge of approximately 46%. The Zacks Consensus Estimate for quarterly revenues is pegged at $993 million, lower than the company provided guidance.
Moreover, Spirit AeroSystems revealed its expectations of reporting a net loss of $160 million in the first quarter compared with the $163-million net income in the prior-year quarter. Further, the company has delivered only 324 aircraft ship sets during the first quarter, down from 453 in the year-ago quarter. At the end of the first quarter of 2020, Spirit AeroSystems’ cash balance was approximately $1.83 billion and total debt balance stood around $3.04 billion.
Further, the company expects the virus outbreak to affect its financial performance for the second quarter more significantly than the first quarter, as it anticipates a slow economic recovery from the effects of the pandemic.
Factors Behind Poor Q1 Prelim Results
During the first quarter, both Boeing (BA - Free Report) and Airbus (EADSY - Free Report) succumbed to the drastic impacts of the coronavirus pandemic, as these aircraft manufacturers had to forcefully halt production until further notice. This is because, with sinking demand for air travel, airlines across the globe started to cancel flights, delayed deliveries of new jets and new orders for jets also touched the bottom. As a result of this and to promote social distancing, both aircraft giants extended the suspension of production at their respective manufacturing units across the United States and Europe.
Notably, this came as a huge blow for Spirit AeroSystems, as it is one of the top-tier suppliers of Airbus and also generates around 80% of its revenues from the supplies made to Boeing. Therefore, we believe that the effects of the coronavirus outbreak on the aviation sector and thereby, the aircraft manufacturers are to be blamed for Spirit AeroSystems’ drab first-quarter preliminary results.
Meanwhile, per a report by Wichita Business Journal, the Bank of America has lowered Spirit AeroSystems’ rating from neutral to underperform and also slashed its per-share price target by a massive 68% from $77 to $25. This further adheres to Spirit AeroSystems’ expectation of incurring a loss in its first-quarter operations.
Another Industry Player’s Q1 Prelim Results
Teledyne Technologies (TDY - Free Report) also recently released its preliminary financial results for first-quarter 2020. The company projects sales of $785 million in the first quarter of 2020 and expects GAAP EPS in the range of $2.10-$2.15. Figures for both metrics imply year-over-year growth. Notably, amid coronavirus woes, Teledyne’s diverse product portfolio has made it resilient to market fluctuations, thereby enabling it to project growth in operational results. (Read more: Teledyne Up on Q1 Preliminary Results Amid Coronavirus Woes).
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Spirit AeroSystems Down on Dismal Q1 Preliminary Results
Spirit AeroSystems Holdings, Inc. (SPR - Free Report) recently released its preliminary financial results for first-quarter 2020. The company’s overall revenues and net income in the quarter are expected to take a hit and be significantly lower than the figures posted in the year-ago quarter.
This aircraft parts manufacturer is likely to report first-quarter results on May 6.
Investor’s Confidence Dwindling
Spirit AeroSystems’ recently announced preliminary results have weighed on investor’s confidence in the stock. As a result, share price of this company declined almost 3.2% in the last trading session on Apr 14 to close at $19.99 a share.
Preliminary Numbers in Detail
Per the latest announcement, the company projects revenues of $1,072 million in the first quarter of 2020, which indicates an annual plunge of approximately 46%. The Zacks Consensus Estimate for quarterly revenues is pegged at $993 million, lower than the company provided guidance.
Moreover, Spirit AeroSystems revealed its expectations of reporting a net loss of $160 million in the first quarter compared with the $163-million net income in the prior-year quarter. Further, the company has delivered only 324 aircraft ship sets during the first quarter, down from 453 in the year-ago quarter. At the end of the first quarter of 2020, Spirit AeroSystems’ cash balance was approximately $1.83 billion and total debt balance stood around $3.04 billion.
Further, the company expects the virus outbreak to affect its financial performance for the second quarter more significantly than the first quarter, as it anticipates a slow economic recovery from the effects of the pandemic.
Factors Behind Poor Q1 Prelim Results
During the first quarter, both Boeing (BA - Free Report) and Airbus (EADSY - Free Report) succumbed to the drastic impacts of the coronavirus pandemic, as these aircraft manufacturers had to forcefully halt production until further notice. This is because, with sinking demand for air travel, airlines across the globe started to cancel flights, delayed deliveries of new jets and new orders for jets also touched the bottom. As a result of this and to promote social distancing, both aircraft giants extended the suspension of production at their respective manufacturing units across the United States and Europe.
Notably, this came as a huge blow for Spirit AeroSystems, as it is one of the top-tier suppliers of Airbus and also generates around 80% of its revenues from the supplies made to Boeing. Therefore, we believe that the effects of the coronavirus outbreak on the aviation sector and thereby, the aircraft manufacturers are to be blamed for Spirit AeroSystems’ drab first-quarter preliminary results.
Meanwhile, per a report by Wichita Business Journal, the Bank of America has lowered Spirit AeroSystems’ rating from neutral to underperform and also slashed its per-share price target by a massive 68% from $77 to $25. This further adheres to Spirit AeroSystems’ expectation of incurring a loss in its first-quarter operations.
Another Industry Player’s Q1 Prelim Results
Teledyne Technologies (TDY - Free Report) also recently released its preliminary financial results for first-quarter 2020. The company projects sales of $785 million in the first quarter of 2020 and expects GAAP EPS in the range of $2.10-$2.15. Figures for both metrics imply year-over-year growth. Notably, amid coronavirus woes, Teledyne’s diverse product portfolio has made it resilient to market fluctuations, thereby enabling it to project growth in operational results. (Read more: Teledyne Up on Q1 Preliminary Results Amid Coronavirus Woes).
Price Performance & Zacks Rank
Shares of this Zacks Rank #3 (Hold) company have plunged 75.6% compared with the industry's 39.5% decline over the past year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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