A flurry of problems continue to plague Boeing, dragging the stock below its sharply declining 50-day moving average. Meanwhile, fellow aerospace and defense firm Heico takes flight with a breakout. Appropriately enough, Heico just joined the IBD Breakout Stocks Index as it soars into buy range.
Brazilian aircraft manufacturer Embraer also earns a spot on the index, which gets updated weekly.
With a 96 Composite Rating, currently Heico stock outpaces 96% of all stocks in terms of key stock-picking factors. Fellow aerospace leaders FTAI Aviation and Embraer also rank among the top 5% of all stocks in IBD's database.
Shares of FTAI have skyrocketed, while industry peer TransDigm — Tuesday's IBD Stock Of The Day — has also climbed to record highs.
Boeing stock, on the other hand, has seen its Composite Rating nose-dive to a lowly 32. But after the close Tuesday, Boeing reported better-than-feared earnings, initally lifting the stock. But BA stock turned tail Wednesday to post more than a 2% loss in huge volume.
In other aviation news, GE Aerospace surged Tuesday after the jet-engine maker topped Q1 forecasts. for its first earnings report as a stand-alone company. GE stock gave back some ground Wednesday. IBD currently classifies GE stock in the Diversified Operations industry group.
See Who Joins Heico On The IBD Breakout Stocks Index
Heico Stock Flies Into Buy Range
With tensions in the Middle East and elsewhere boosting defense stocks like TransDigm and FTAI Aviation, Heico launched a breakout Tuesday.
The stock cleared a 200.64 buy point in an early stage flat base. It remains in buy range, which extends up to 5% above the initial entry, or to 210.67.
The sharp rise in the relative strength line shows how Heico is outpacing the performance of the S&P 500.
Showing resilience Wednesday, the stock came off its lows to close in the top half of the day's price range.
Heico Fuels Growth, Strong Forecasts
Founded in 1957, Heico operates across the aerospace, industrial, defense and electronics industries. Its products are found on airline, regional, business and military aircraft. Heico's offerings are also found on a large variety of industrial turbines, targeting systems, missiles and electro-optical devices.
The company divides its various subsidiaries into two segments: Flight Support and Electronic Technologies.
On Feb. 26, Heico reported its performance for the first quarter of fiscal 2024. Earnings jumped 14% to 72 cents a share. Year-over-year sales rose 44% to over $896 billion.
While analysts expect 7% EPS growth to 82 cents a share in the current fiscal quarter (to be reported May 28), they expect earnings growth of 24%, then 34% in the following two quarterly reports.
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Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
