Aerospace and defense components maker TransDigm reported better-than-expected fiscal fourth-quarter earnings and revenue Thursday, sending TDG stock higher, breaking out above a buy point.
The Cleveland-based outfit saw fiscal Q4 EPS surge 46% to $8.03 while sales increased 23% to $1.85 billion. Wall Street had expected earnings of $7.55 per share and revenue totaling $1.84 billion.
For the full fiscal year, TransDigm profit jumped 50% to $25.84 per share. Full fiscal-year revenue advanced 21% to $6.58 billion.
"We were very pleased to see the progression of the commercial aerospace market recovery in our fiscal 2023 and we expect the recovery to continue in our fiscal 2024. Trends remain favorable across all three of our market channels,"TransDigm Chief Executive Kevin Stein said in the earnings release.
TransDigm also announced Thursday a special cash dividend of $35 on each outstanding share of common stock and cash dividend equivalent payments under options granted under its stock options plans. The record date for the special dividend is Nov. 20 and the payment date for the dividend is Nov. 27, according to the company.
TransDigm stock surged 8.7% to 972.77, moving above a buy point, Thursday during market action. On Wednesday, TDG edged up 0.3% to 895.21. Defense giant Lockheed Martin edged down 0.5% Thursday. Meanwhile RTX, formerly known as Raytheon Technologies, dropped nearly 1%.
2024 Guidance
TransDigm manufactures highly engineered parts and devices used in commercial and military aircraft, as well as proprietary products for defense applications. Its products include ignition systems, pumps, flight controls, cockpit displays and radio systems.
The company expects fiscal 2024 sales between $7.48 billion-$7.68 and EPS around $31.00- $32.94. Wall Street forecasts earnings of $31.41 per share and $7.40 billion in revenue for fiscal 2024.
TransDigm expects revenue from its commercial original equipment manufacturing (OEM) business to grow by approximately 20% with revenue from its commercial aftermarket business increasing in the midteens percentage range. TransDigm expects sales from its defense business to increase in the mid to high-single-digit percentage range.
TDG Stock
TDG broke out above a 940 buy point in a flat base, according to MarketSmith analysis, with its move Thursday.
Ahead of Thursday trade, the shares were already up more than 8% in November, with a 42% gain in 2023. TDG stock has booked nine consecutive daily gains dating back to Oct. 27.
TranDigm stock has a 95 Composite Rating out of 99. The stock also has a 92 Relative Strength Rating and an 87 EPS Rating.
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