As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at aerospace stocks, starting with TransDigm (NYSE: TDG).
Aerospace companies often possess technical expertise and have made significant capital investments to produce complex products. It is an industry where innovation is important, and lately, emissions and automation are in focus, so companies that boast advances in these areas can take market share. On the other hand, demand for aerospace products can ebb and flow with economic cycles and geopolitical tensions, which can be particularly painful for companies with high fixed costs.
The 15 aerospace stocks we track reported a strong Q1. As a group, revenues missed analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was 0.7% below.
Luckily, aerospace stocks have performed well with share prices up 21.2% on average since the latest earnings results.
TransDigm (NYSE: TDG)
Supplying parts for nearly all aircraft currently in service, TransDigm (NYSE: TDG) develops and manufactures components and systems for military and commercial aviation.
TransDigm reported revenues of $2.15 billion, up 12% year on year. This print fell short of analysts’ expectations by 0.7%. Overall, it was a mixed quarter for the company with an impressive beat of analysts’ adjusted operating income estimates but a slight miss of analysts’ organic revenue estimates.
"I am very pleased with the operating results for the second quarter. We continued to see strong performance as we closed out the first half of our fiscal year," stated Kevin Stein, TransDigm Group's President and Chief Executive Officer.
The stock is down 1.2% since reporting and currently trades at $1,457.
Is now the time to buy TransDigm? Access our full analysis of the earnings results here, it’s free.
Best Q1: Curtiss-Wright (NYSE: CW)
Formed from a merger of 12 companies, Curtiss-Wright (NYSE: CW) provides a range of products and services to the aerospace, industrial, electronic, and maritime industries.
Curtiss-Wright reported revenues of $805.6 million, up 13% year on year, outperforming analysts’ expectations by 5%. The business had an exceptional quarter with a solid beat of analysts’ EBITDA and adjusted operating income estimates.
The market seems happy with the results as the stock is up 30.8% since reporting. It currently trades at $474.01.
Is now the time to buy Curtiss-Wright? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: AerSale (NASDAQ: ASLE)
Providing a one-stop shop that integrates multiple services and product offerings, AerSale (NASDAQ: ASLE) delivers full-service support to mid-life commercial aircraft.
AerSale reported revenues of $65.78 million, down 27.4% year on year, falling short of analysts’ expectations by 26.3%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
AerSale delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 16.2% since the results and currently trades at $5.89.
Read our full analysis of AerSale’s results here.
Textron (NYSE: TXT)
Listed on the NYSE in 1947, Textron (NYSE: TXT) provides products and services in the aerospace, defense, industrial, and finance sectors.
Textron reported revenues of $3.31 billion, up 5.5% year on year. This result surpassed analysts’ expectations by 2.3%. Overall, it was a very strong quarter as it also put up an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ organic revenue estimates.
The stock is up 21% since reporting and currently trades at $80.
Read our full, actionable report on Textron here, it’s free.
Astronics (NASDAQ: ATRO)
Integrating power outlets into many Boeing aircraft, Astronics (NASDAQ: ATRO) is a provider of technologies and services to the global aerospace, defense, and electronics industries.
Astronics reported revenues of $205.9 million, up 11.3% year on year. This print beat analysts’ expectations by 7.3%. It was an exceptional quarter as it also recorded an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
Astronics delivered the biggest analyst estimates beat among its peers. The stock is up 39.5% since reporting and currently trades at $32.76.
Read our full, actionable report on Astronics here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
