Q4 Earnings Highlights: Ducommun (NYSE:DCO) Vs The Rest Of The Aerospace Stocks
Let’s dig into the relative performance of Ducommun (NYSE:DCO) and its peers as we unravel the now-completed Q4 aerospace earnings season.
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 mixed Q4. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 6.9% since the latest earnings results.
California’s oldest company, Ducommun (NYSE:DCO) is a provider of engineering and manufacturing services for high-performance products primarily within the aerospace and defense industries.
Ducommun reported revenues of $197.3 million, up 2.6% year on year. This print exceeded analysts’ expectations by 1.1%. Despite the top-line beat, it was still a softer quarter for the company with a significant miss of analysts’ adjusted operating income estimates.
“We made excellent progress in our VISION 2027 commitments in 2024 with the bright spots being earnings, EBITDA margins and reaching 23% of revenue for Engineered Products. In addition, I am very happy to report that the Company reached an all-time revenue record for the second consecutive year in 2024. In Q4 we continued the top-line growth story for Ducommun, led by our military and space business,” said Stephen G. Oswald, chairman, president and chief executive officer.
Ducommun Total Revenue
The stock is down 9.4% since reporting and currently trades at $55.56.
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 applications
Moog reported revenues of $910.3 million, up 6.2% year on year, outperforming analysts’ expectations by 5.3%. The business had a satisfactory quarter with an impressive beat of analysts’ adjusted operating income estimates.
Moog Total Revenue
The market seems unhappy with the results as the stock is down 21.1% since reporting. It currently trades at $165.52.
One of the companies that forms a duopoly in the commercial aircraft market, Boeing (NYSE:BA) develops, manufactures, and services commercial airplanes, defense products, and space systems.
Boeing reported revenues of $15.24 billion, down 30.8% year on year, falling short of analysts’ expectations by 6.4%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Boeing delivered the slowest revenue growth in the group. As expected, the stock is down 8.8% since the results and currently trades at $159.84.
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 $94.74 million, flat year on year. This number beat analysts’ expectations by 3.4%. Overall, it was an exceptional quarter as it also put up a solid beat of analysts’ EBITDA estimates.
The stock is up 4.4% since reporting and currently trades at $7.39.
Based in Jacksonville, Florida, Redwire (NYSE:RDW) is a provider of systems and components used in space infrastructure.
Redwire reported revenues of $69.56 million, up 9.6% year on year. This print lagged analysts’ expectations by 6.7%. More broadly, it was a mixed quarter as it also logged full-year EBITDA guidance exceeding analysts’ expectations.
Redwire achieved the highest full-year guidance raise but had the weakest performance against analyst estimates among its peers. The stock is down 14.5% since reporting and currently trades at $9.63.
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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