Core Insights - Aerospace-Defense Equipment stocks are expected to benefit from strategic mergers and acquisitions, enhancing operational scale and market presence, despite ongoing supply-chain challenges affecting aircraft deliveries and profitability [1][3][5]. Industry Overview - The Zacks Aerospace-Defense Equipment industry includes firms manufacturing essential components for aerospace and defense, such as aerostructures, propulsion systems, and defense electronics, while also providing aftermarket support services [2]. Trends Shaping the Industry - Recent mergers and acquisitions, such as TransDigm's $110 million acquisition of Servotronics and Teledyne's acquisition of Maretron assets, are expected to improve economies of scale and revenue growth [3]. - Global air passenger traffic is projected to grow by 5.8% year-over-year in 2025, indicating strong growth potential for aerospace-defense equipment stocks, particularly in commercial aviation [4]. Supply Chain Challenges - Supply-chain disruptions are impacting aircraft deliveries, with current deliveries 30% below peak levels, contributing to a backlog of 17,000 aircraft, which represents an 18% shortfall of the active global fleet [5]. Industry Performance - The Zacks Aerospace-Defense Equipment industry has outperformed both the S&P 500 composite and its sector, with a collective stock surge of 46.2% over the past year compared to 27.1% for the Aerospace sector and 10.9% for the S&P 500 [8]. Valuation Metrics - The industry is currently trading at an EV/Sales ratio of 11.14X, significantly higher than the S&P 500's 5.41X and the sector's 3.27X, indicating a premium valuation for capital-intensive aerospace-defense stocks [11]. Notable Companies - **Heico Corp.**: Expected to see a 13.3% sales improvement in fiscal 2025, with a long-term earnings growth rate of 17.6% [15][16]. - **AAR Corp.**: Anticipated 17.2% sales growth in fiscal 2025, with a Zacks Rank of 2 (Buy) [17][18]. - **Curtiss-Wright**: Projected 8.8% sales growth in fiscal 2025, recently awarded an $80 million contract by the USAF [20][22].

Q1 2021 Performance - Adjusted net sales increased by 2% overall, with Aerospace & Defense markets up by 8%[4] - Adjusted operating income increased by 15%, leading to an adjusted operating margin increase of 160 bps to 150%[4] - Adjusted diluted EPS was $151, an increase of 18%[4] - New orders reached $571 million, up by 3%, driven by a strong 12x book-to-bill ratio in commercial markets[4] FY 2021 Adjusted Guidance - The company raised full-year guidance for sales, operating income, operating margin, and EPS[5] - Expect sales growth of 7% - 9%, with solid growth in both A&D and commercial end markets[5] - Solid operating income growth of 9% - 11% outpacing sales growth, and driving continued margin expansion of 30 - 40 bps to 166% - 167%[5] - Adjusted diluted EPS increased by $010 to a new range of $710 - $730, up 8% - 11%[5] - Maintained FCF guidance range of $330 - $360 million, with adjusted FCF conversion >110%[5] Segment Performance (Q1 2021) - Aerospace & Industrial sales decreased by 15% to $178 million, while operating margin decreased by 330 bps to 104%[6] - Defense Electronics sales increased by 31% to $182 million, with operating margin up 170 bps to 209%[6] - Naval & Power sales increased by 1% to $230 million, with operating margin up 300 bps to 177%[6] 2021E End Market Sales Growth (Guidance) - Total Aerospace & Defense markets are expected to grow by 7% - 9%, accounting for 66% of total sales[8] - Total Commercial Markets are expected to grow by 6% - 8%, accounting for 34% of total sales[8] - Total Curtiss-Wright sales are expected to grow by 7% - 9%, with organic growth up 2% - 4%[8] 2021E Financial Outlook (Guidance) - Total sales are projected to be between $2450 - $2500 million, representing a 7% - 9% increase[10] - Total operating income is projected to be between $408 - $418 million, representing a 9% - 11% increase[10] - Diluted EPS is projected to be between $710 - $730, representing an 8% - 11% increase[12] - Free cash flow is projected to be between $330 - $360 million, with a free cash flow conversion of ~116%[14]

Q3 2021 Performance Highlights - Adjusted Sales increased by 12% overall[5] - Aerospace & Defense (A&D) markets were up by 15%[5] - Commercial markets increased by 6%[5] - Adjusted Operating Income rose by 12%, resulting in an Adjusted Operating Margin of 17.5%[5] - Adjusted Earnings Per Share (EPS) reached $1.88, exceeding expectations[5] - Adjusted Free Cash Flow (FCF) grew significantly by 76% to $97 million, with a 127% FCF conversion rate[5] - New Orders showed strong growth of 13%, leading to a Book-to-bill ratio exceeding 1.0x[5] Capital Allocation and Guidance - Share repurchase authorization expanded by $400 million, with a $200 million opportunistic program completed[5] - The company remains on track to complete $250 million in repurchases in 2021, expecting to repurchase approximately 2.0 million total shares[5] - $350 million open repurchase authorization remaining[5] - Full-year guidance maintained for Sales, Operating Income, Operating Margin, and FCF[5] - Adjusted EPS range raised, now $7.20 - $7.35, up 9% - 12%[5] 2021E Financial Outlook - Total Sales are projected to be between $2,465 million and $2,515 million, representing a 7% - 9% increase compared to 2020 Adjusted figures[8] - Aerospace & Industrial segment sales are expected to be between $760 million and $775 million, a 3% - 5% increase[8] - Defense Electronics segment sales are projected to be between $745 million and $760 million, a 22% - 24% increase[8] - Naval & Power segment sales are expected to be between $960 million and $980 million, a 1% - 3% increase[8] - Total Operating Income is projected to be between $411 million and $421 million, up 9% - 12%[10]

Q1 2022 Performance - Sales reached $559 million, impacted by the timing of Defense revenues[5] - New orders increased by 12%, resulting in a book-to-bill ratio exceeding 1.1x[5] - Adjusted diluted EPS was $1.31, surpassing expectations[5] - Total sales decreased by 5% from $590 million in Q1'21 to $559 million in Q1'22[7] Segment Performance (Q1 2022 vs Q1 2021) - Aerospace & Industrial sales increased by 8%, from $178 million to $191 million[7] - Defense Electronics sales decreased by 22%, from $182 million to $143 million[7] - Naval & Power sales decreased by 2%, from $230 million to $225 million[7] - Aerospace & Industrial margin increased by 260 bps to 13.0%[7] - Defense Electronics margin decreased by 460 bps to 16.3%[7] - Naval & Power margin decreased by 320 bps to 14.5%[7] FY 2022 Guidance - The company maintains FY'22 adjusted guidance, projecting sales growth of 3% - 5%[6] - The company anticipates EPS growth of 10% - 12%[6] - Aerospace & Industrial sales are projected to grow by 4% - 6%, reaching $805 - $825 million[10] - Defense Electronics sales are projected to grow by 2% - 4%, reaching $745 - $760 million[10] - Naval & Power sales are projected to grow by 2% - 3%, reaching $980 - $995 million[10] - The company expects operating margin to increase by 10 - 30 bps to 17.1% - 17.3%[14]

Core Viewpoint - Curtiss-Wright Corp. (CW) is positioned as a strong investment opportunity within the Zacks Aerospace Defense Equipment industry, driven by growth in commercial nuclear aftermarket sales and shareholder-friendly initiatives [1] Group 1: Growth Forecast & Financial Performance - The Zacks Consensus Estimate for CW's 2025 earnings per share (EPS) has risen by 3.7% to $12.61 [2] - CW's projected revenues for 2025 are $3.38 billion, reflecting an 8.5% growth [2] - The company's long-term earnings growth rate is estimated at 12% [2] - CW has consistently surpassed earnings expectations, achieving an average earnings surprise of 13.34% over the last four quarters [2] Group 2: Shareholder Returns - CW has been enhancing shareholder value through regular dividend payments, with a current quarterly dividend of 24 cents per share, leading to an annualized dividend of 96 cents [3] - The current dividend yield stands at 0.20%, which is above the industry average of 0.16% [3] Group 3: Financial Health - As of the end of Q1 2025, CW's current ratio is 1.89, surpassing the industry average of 1.76, indicating strong short-term liability management [4] - CW's return on equity (ROE) is 18.02%, significantly higher than the industry average of 8.44%, showcasing effective fund utilization [5] - The total debt to capital ratio for CW is 27.25%, well below the industry average of 51.94%, indicating a strong debt management position [6] - CW's times interest earned ratio (TIE) is 13.3, reflecting the company's capability to meet interest obligations comfortably [6] Group 4: Market Position & Operations - The U.S. market is crucial for CW's nuclear power expansion, with significant growth in commercial nuclear aftermarket sales driven by demand for small modular reactors [9] - The acquisition of Ultra Energy in December 2024 has bolstered CW's capabilities in neutron and radiation monitoring, sensors, and reactor protection systems [9] - CW is actively collaborating with leading 300-megawatt reactor designers to develop critical systems and equipment, positioning itself for growth in both U.S. and global nuclear markets [10] Group 5: Stock Performance - Over the past three months, CW's stock has increased by 57.4%, outperforming the industry's growth of 29% [11]

Core Viewpoint - Curtiss-Wright (CW) shares have increased by approximately 18.8% over the past month, outperforming the S&P 500, raising questions about the sustainability of this positive trend leading up to the next earnings release [1] Estimates Movement - Estimates for Curtiss-Wright have trended upward over the past month, indicating a positive outlook for the stock [2] VGM Scores - Curtiss-Wright currently holds a subpar Growth Score of D, a Momentum Score of B, and a Value Score of D, placing it in the bottom 40% for the value investment strategy. The aggregate VGM Score for the stock is D, which is relevant for investors not focused on a single strategy [3] Outlook - The upward trend in estimates suggests a promising outlook for Curtiss-Wright, which has a Zacks Rank of 2 (Buy), indicating expectations for above-average returns in the coming months [4] Industry Performance - Curtiss-Wright is part of the Zacks Aerospace - Defense Equipment industry, where Woodward (WWD) has gained 19.3% over the past month. Woodward reported revenues of $883.63 million for the quarter ended March 2025, reflecting a year-over-year increase of 5.8% [5] Woodward's Earnings Expectations - Woodward is projected to post earnings of $1.60 per share for the current quarter, representing a year-over-year decline of 1.8%. The Zacks Consensus Estimate for Woodward has changed by -0.5% over the last 30 days, and it also holds a Zacks Rank of 2 (Buy) [6]

Market Overview - The AI-driven bull run of 2023 and 2024 has faced setbacks in 2025 due to the Fed's uncertainty over rate cuts, recession fears, and competition from a low-cost Chinese AI platform [1] - Concerns regarding the Trump administration's tariff and trade policies have negatively impacted confidence in risky assets, particularly in the technology sector [2] Company Highlights Howmet Aerospace Inc. (HWM) - HWM is experiencing strong momentum in the commercial aerospace market, supported by robust build rates and recovery in wide-body aircraft [6] - The company has a projected revenue growth rate of 8.5% and an earnings growth rate of 28.6% for the current year, with a 4.2% improvement in earnings estimates over the last 30 days [7] Newmont Corp. (NEM) - NEM is advancing its growth projects, including the Tanami expansion and the Ahafo North project, with a total investment of $950 million to $1,050 million [10][11] - The expected revenue growth rate is 2% and earnings growth rate is 20.1% for the current year, with a 9.7% increase in earnings estimates over the last 30 days [11] Sprouts Farmers Market Inc. (SFM) - SFM focuses on product innovation, e-commerce, and private label offerings, leading to better-than-expected fourth-quarter results [12] - The company anticipates net sales growth of 10.5% to 12.5% and comparable store sales growth of 4.5% to 6.5% for 2025, with expected revenue growth of 13.7% and earnings growth of 35.5% for the current year [13][14] GE Aerospace (GE) - GE Aerospace is benefiting from strong demand for commercial engines and rising defense budgets, with an expected organic revenue growth in the low-double-digit range [15][16] - The company has a projected revenue decline of 6.8% but an earnings growth rate of 19.6% for the current year, with a slight improvement in earnings estimates [16] Curtiss-Wright Corp. (CW) - CW is capitalizing on the global shift towards alternative energy, particularly in nuclear power, with potential orders for 20-25 new reactors in Central and Eastern Europe [17][18] - The expected revenue growth rate is 8.5% and earnings growth rate is 15.7% for the current year, with a 0.5% improvement in earnings estimates [19]

Summary of Curtiss Wright's Presentation at the William Blair Growth Stock Conference Company Overview - **Company**: Curtiss Wright - **Industry**: Aerospace and Defense - **Key Personnel**: CEO Lynn Bamford, CFO Chris Farkas, Head of Investor Relations Jim Ryan - **Milestone**: Celebrated 95 years on the New York Stock Exchange [8][9] Core Messages - **Pivot to Growth Strategy**: Launched four years ago, focusing on growth and operational excellence [6][12] - **Financial Performance**: Strong financial results with a track record of achieving financial targets set during Investor Days [7][12] - **Engineering Workforce**: Approximately 9,000 employees, with 2,000 engineers, emphasizing collaboration and talent development [11] Operational Strategies - **Operational Growth Platform**: Focus on maximizing profitability through commercial and operational excellence [12] - **R&D Investments**: Increased R&D investments above sales growth, contributing to margin expansion and earnings growth in the mid-teens [12][26] - **Cost Efficiency**: Ongoing consolidation programs to drive efficiencies and reinvest in the business [13] End Markets and Growth Opportunities - **Navy Footprint**: Significant supplier for U.S. Navy platforms, targeting increased content for future generation platforms [19][20] - **Defense Electronics**: Partnership with NVIDIA to enhance electronics capabilities for battlefield technology [20] - **Nuclear Industry**: Focus on aftermarket services, life extensions, and new reactor builds, including small modular reactors (SMRs) [18][22][24] Market Trends - **Commercial Aerospace**: Anticipated multiyear ramp in growth, heavily focused on OEM [31] - **Foreign Military Spending**: Increased spending contributing to growth in defense markets [31] - **Nuclear Energy Expansion**: Targeting significant growth in nuclear energy, with potential for $1.5 billion in market share from Eastern Europe and additional opportunities from U.S. reactor builds [28][39][40] Financial Targets and Performance - **Sales Growth**: Targeting over 5% organic sales growth, with mid to high single-digit growth in defense markets [31] - **Operating Margins**: Expected operating margin expansion, with a current target of 18.4% [34] - **Free Cash Flow**: Projecting $1.3 billion in free cash flow over three years, with a strong focus on capital allocation [35][36] Future Outlook - **Nuclear Reactor Opportunities**: Anticipating orders for AP1000 reactors in 2026, with significant growth potential in the nuclear sector [43] - **Strategic Partnerships**: Collaborations with major players in the nuclear industry to enhance market position [40][41] Conclusion - **Investment Proposition**: Curtiss Wright's pivot to growth strategy is yielding positive results, with strong market positioning and a focus on delivering value to shareholders [28][29]

Core Viewpoint - Curtiss-Wright Corp. (CW) is positioned as a strong investment option within the Zacks Aerospace Defense Equipment industry, benefiting from its commercial nuclear aftermarket sales and shareholder-friendly initiatives [1] Group 1: Growth Forecast & Financial Performance - The Zacks Consensus Estimate for CW's 2025 earnings per share (EPS) has risen by 3.2% to $12.55 per share over the past month [2] - CW's projected revenues for 2025 are estimated at $3.38 billion, reflecting an 8.3% growth [2] - The company's long-term earnings growth rate is forecasted at 12% [2] - CW has consistently surpassed expectations in the last four quarters, achieving an average earnings surprise of 13.34% [2] Group 2: Debt Profile - Curtiss-Wright's total debt to capital ratio stands at 27.25%, significantly lower than the industry average of 52.52% [3] - The times interest earned (TIE) ratio is 13.3, indicating a strong ability to meet future interest obligations [3] Group 3: Return on Equity - CW's return on equity (ROE) is currently at 18.02%, outperforming the industry average of 11.19%, demonstrating effective fund utilization [4] Group 4: Liquidity Position - The current ratio for Curtiss-Wright is 1.89, surpassing the industry average of 1.79, indicating a solid capacity to meet short-term liabilities [5] Group 5: Shareholder Initiatives - CW has increased its quarterly dividend to 24 cents per share, a 14.3% rise from the previous 21 cents, leading to an annualized dividend of 96 cents [6] - The current dividend yield is 0.22%, which is better than the industry average of 0.19% [6] Group 6: Commercial Nuclear Business - The U.S. market remains crucial for CW's nuclear power expansion, with significant growth in commercial nuclear aftermarket sales driven by demand for advanced small modular reactors [7] - In December 2024, CW expanded its nuclear solutions portfolio by acquiring Ultra Energy, enhancing its capabilities in neutron and radiation monitoring [7] Group 7: Stock Performance - Over the past three months, Curtiss-Wright's stock has increased by 35.7%, compared to the industry's growth of 7.9% [9]

Technical Analysis - Curtiss-Wright Corporation (CW) has reached a key level of support, with its 50-day simple moving average crossing above its 200-day simple moving average, indicating a "golden cross" [1] - A golden cross is a bullish technical chart pattern that suggests a potential breakout, as it occurs when a stock's short-term moving average surpasses a longer-term moving average [1][2] Performance Metrics - Over the past four weeks, CW has gained 24%, indicating strong upward momentum [3] - The company currently holds a 2 (Buy) rating on the Zacks Rank, suggesting that the stock may be positioned for further gains [3] Earnings Outlook - There have been no earnings estimate cuts for CW in the current quarter, with four revisions higher in the past 60 days, indicating a positive earnings outlook [3] - The Zacks Consensus Estimate for CW has also increased, further supporting the bullish case for the stock [3][5]