As the Q1 earnings season wraps, let’s dig into this quarter’s best and worst performers in the aerospace industry, including Moog (NYSE:MOG.A) and its peers.
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 12 aerospace stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 1.9% while next quarter’s revenue guidance was 2.8% above.
Big picture, the Federal Reserve has a dual mandate of inflation and employment. The former had been running hot throughout 2021 and 2022 but cooled towards the central bank's 2% target as of late. This prompted the Fed to cut its policy rate by 50bps (half a percent) in September 2024. Given recent employment data that suggests the US economy could be wobbling, the markets will be assessing whether this rate and future cuts (the Fed signaled more to come in 2024 and 2025) are the right moves at the right time or whether they're too little, too late for a macro that has already cooled.
Thankfully, aerospace stocks have been resilient with share prices up 7.4% on average since the latest earnings results.
Best Q1: Moog (NYSE:MOG.A)
Responsible for the flight control actuation system integrated in the B-2 stealth bomber, Moog (NYSE:MOG.A) provides precision motion control solutions used in aerospace and defense applicationsMoog reported revenues of $930.3 million, up 11.2% year on year. This print exceeded analysts’ expectations by 6.5%. Overall, it was an incredible quarter for the company with improvements in its profitability ratios.
Interestingly, the stock is up 24.8% since reporting and currently trades at $196.32.
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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 $784.8 million, up 11.4% year on year, outperforming analysts’ expectations by 6.7%. The business had an exceptional quarter with an impressive beat of analysts’ operating margin estimates and full-year revenue guidance exceeding analysts’ expectations.
The market seems happy with the results as the stock is up 29.7% since reporting. It currently trades at $347.46.
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 $77.1 million, up 11.2% year on year, falling short of analysts’ expectations by 12.7%. It was a disappointing quarter as it posted a miss of analysts’ earnings estimates.
AerSale delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 13.6% since the results and currently trades at $4.81.
Redwire (NYSE:RDW)
Based in Jacksonville, Florida, Redwire (NYSE:RDW) is a provider of systems and components used in space infrastructure.Redwire reported revenues of $78.11 million, up 30% year on year. This number topped analysts’ expectations by 14.2%. Overall, it was a very strong quarter as it also recorded full-year revenue guidance exceeding analysts’ expectations.
Redwire pulled off the biggest analyst estimates beat among its peers. The stock is up 35.2% since reporting and currently trades at $7.76.
Woodward (NASDAQ:WWD)
Initially designing controls for water wheels in the early 1900s, Woodward (NASDAQ:WWD) designs, services, and manufactures energy control products and optimization solutions.Woodward reported revenues of $847.7 million, up 5.9% year on year. This result was in line with analysts’ expectations. Taking a step back, it was a mixed quarter with a miss of analysts’ operating margin estimates.
The stock is down 10.4% since reporting and currently trades at $164.25.
This content was originally published on Stock Story
