Defense components provider Heico earnings grew for the seventh consecutive quarter for Q1 results late Monday. However, Heico stock retreated after hours as earnings fell short of Wall Street estimates.
Hollywood, Fla.-based Heico makes electronic equipment, components and parts for defense, aviation and aerospace customers. The company provides repair, manufacturing, engineering and reverse engineering services. Its weapons systems support military aircraft such as Lockheed Martin C-130 Hercules, the Boeing E-3 Sentry, as well as F-15 and F-16 fighter jets.
RBC Capital analyst Ken Herbert anticipates continued strength from Heico's aerospace business and in a research note Friday wrote its Flight Support Group segment should benefit from a strong commercial aftermarket. Herbert raised his price target on Heico stock to $190 from $180 and maintained its Outperform rating.
Heico's earnings and revenue rose for the seventh quarter in a row on Monday. Earnings rose 7% to 67 cents per share while sales jumped 27% to a quarterly record $620.9 million. During the quarter, Heico incurred $5.1 million in acquisition costs related to closing its deal for Exxelia International in January 2023. The purchase decreased Q1 earnings by about 3 cents per diluted share.
The earnings results just fell short of Wall Street expectations. Analysts saw adjusted earnings increasing 9.5% to 69 cents per share on 20% revenue growth to $588 million.
Heico Stock
HEI stock is extended after a January breakout from a flat base. Heico stock retreated 4.3% after hours following the earnings results and faded 0.11% during the trading day.
Shares are up 13.7% year-to-date.
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