Core Insights - Woodward, Inc. (WWD) reported strong first-quarter fiscal 2026 results, with adjusted net earnings per share (EPS) of $2.17, a 60.7% increase year over year, surpassing the Zacks Consensus Estimate by 31.5% [1][8] - Quarterly net sales reached $996 million, reflecting a 29% year-over-year growth, driven by favorable market conditions in Aerospace and Industrial sectors, and exceeding consensus estimates by 10.1% [1][2] Financial Performance - Aerospace segment net sales were $635 million, up 29% year over year, supported by strong demand in commercial services and defense OEM [4] - Industrial segment net sales totaled $362 million, a 30% increase year over year, driven by growth in transportation, power generation, and oil & gas markets [6] - Overall gross margin improved by 480 basis points to 29.3%, with total costs and expenses rising 23.3% year over year to $827.3 million [10] Operational Highlights - The company emphasized operational excellence, leading to productivity gains and consistent execution across its portfolio [2][3] - Segmental earnings in Aerospace rose to $148 million from $95 million a year ago, with margins expanding 420 basis points to 23.4% [5] - In the Industrial segment, earnings increased to $67 million from $40 million, with margins up 410 basis points to 18.5% [9] Cash Flow and Shareholder Returns - Woodward generated $114.4 million in net cash from operating activities, up from $34.5 million in the prior year, and free cash flow increased to $70 million from $1 million [11][12] - The company returned $146 million to shareholders through dividends and share repurchases [13] Guidance and Future Outlook - Following the strong first-quarter performance, Woodward raised its fiscal 2026 guidance, expecting consolidated net sales to grow 14% to 18%, up from the previous 7% to 12% [14][15] - EPS guidance was also increased to a range of $8.2 to $8.6, compared to the prior expectation of $7.5 to $8 [17]

分组1 - Woodward (WWD) reported first-quarter earnings that exceeded estimates for both revenue and earnings per share [1] - The analysis of Woodward's prospects was reiterated with a buy rating, indicating positive sentiment towards the company's future performance [1] - The aerospace and defense industry is highlighted as having significant growth prospects, with the analyst providing context to developments that may impact investment theses [1] 分组2 - The investing group, The Aerospace Forum, aims to identify investment opportunities within the aerospace, defense, and airline sectors [1] - The analyst has a background in aerospace engineering, which informs the analysis of the complex industry [1] - The group offers access to data analytics monitors, enhancing the investment research process [1]

Core Insights - Woodward, Inc. is a key player in the aerospace and industrial equipment markets, focusing on energy conversion and control solutions, and is committed to a clean future through innovative products [1] Financial Performance - For the quarter ending February 2, 2026, Woodward reported earnings per share (EPS) of $2.17, exceeding the estimated $1.65 by 31.35%, and showing a year-over-year increase from $1.35 [2][6] - The company achieved revenues of approximately $996.5 million, surpassing estimates of $893.2 million by 10.11%, and up from $773 million in the same period last year [3][6] Segment Performance - The Aerospace segment benefited from a higher mix of commercial services activity and strong demand from defense OEMs, while the Industrial segment showed strength in power generation and transportation sectors [3] Financial Health - Woodward maintains a low debt-to-equity ratio of 0.096, indicating a conservative approach to leveraging equity, and a current ratio of about 2.08, suggesting good short-term financial health [4] - The company increased its quarterly cash dividend by 14%, raising it from $0.28 to $0.32 per share [4][6] Valuation Metrics - Woodward's valuation metrics include a price-to-earnings (P/E) ratio of approximately 44.35 and a price-to-sales ratio of about 5.50, indicating that investors are willing to pay a premium for its earnings and sales [5] - The enterprise value to sales ratio is approximately 5.48, while the enterprise value to operating cash flow ratio is around 41.49, reflecting the company's valuation relative to its sales and cash flow from operations [5]

Core Insights - Woodward (WWD) reported revenue of $996.45 million for the quarter ended December 2025, marking a year-over-year increase of 29% and exceeding the Zacks Consensus Estimate by 10.11% [1] - The earnings per share (EPS) for the same period was $2.17, up from $1.35 a year ago, representing a surprise of 31.35% over the consensus estimate of $1.65 [1] Financial Performance - The company’s shares have returned +2.3% over the past month, outperforming the Zacks S&P 500 composite's +0.7% change, and currently holds a Zacks Rank 2 (Buy) [3] - Segment external net sales for Industrial reached $361.56 million, surpassing the average estimate of $299.2 million, with a year-over-year change of +29.7% [4] - Aerospace segment external net sales totaled $634.9 million, exceeding the estimated $581.03 million, reflecting a +28.6% year-over-year change [4] - Aerospace segment net sales for the Defense aftermarket were $64 million, slightly below the average estimate of $67.05 million, with a +1.6% year-over-year change [4] - Commercial aftermarket sales in the Aerospace segment were $245 million, significantly above the estimated $199.15 million, showing a +49.4% year-over-year increase [4] - Aerospace segment net sales for Commercial OEM reached $188 million, compared to the average estimate of $171.79 million, representing a +22.1% year-over-year change [4] - Aerospace segment net sales for Defense OEM were $138 million, slightly below the average estimate of $142.18 million, with a +22.1% year-over-year change [4] - Aerospace segment earnings were $148.4 million, exceeding the average estimate of $127.79 million [4] - Industrial segment earnings were $66.99 million, compared to the average estimate of $44.05 million [4]

Core Viewpoint - Woodward (WWD) reported quarterly earnings of $2.17 per share, exceeding the Zacks Consensus Estimate of $1.65 per share, and showing an increase from $1.35 per share a year ago [1] Financial Performance - The earnings surprise for the quarter was +31.35%, with the company previously expected to post earnings of $1.83 per share but actually delivering $2.09, resulting in a surprise of +14.21% [2] - Woodward's revenues for the quarter reached $996.45 million, surpassing the Zacks Consensus Estimate by 10.11%, compared to $772.72 million in the same quarter last year [3] Market Performance - Woodward shares have increased approximately 5.1% since the beginning of the year, outperforming the S&P 500's gain of 1.4% [4] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $1.94 on revenues of $981.53 million, and for the current fiscal year, it is $7.85 on revenues of $3.97 billion [8] - The Zacks Industry Rank for Aerospace - Defense Equipment is in the top 26% of over 250 Zacks industries, indicating a favorable outlook for the sector [9]

Woodward (NasdaqGS:WWD) Q1 2026 Earnings call February 02, 2026 05:00 PM ET Company ParticipantsAlexandra Mandery - Equity Research AssociateBill Lacey - CFOChip Blankenship - Chairman and CEODan Provaznik - Director of Investor RelationsGavin Parsons - Equity ResearchKyle Wenclawiak - Equity Research Senior AssociateLouis Raffetto - SVP of Equity ResearchNoah Poponak - Managing DirectorPeter Skibitski - DirectorScott Deuschle - DirectorScott Mikus - Vice President of Equity ResearchConference Call Particip ...

Financial Data and Key Metrics Changes - In the first quarter of fiscal year 2026, the company reported net sales of $996 million, a 29% increase year-over-year, and earnings per share of $2.17, up from $1.42, reflecting a 54% increase [14][6] - Free cash flow for the first quarter was $70 million, significantly higher than the previous year's $1 million [21][20] Business Line Data and Key Metrics Changes - Aerospace segment sales increased to $635 million, a 29% rise, driven primarily by a 50% increase in commercial services sales [15][14] - Industrial segment sales reached $362 million, up 30%, with core industrial sales (excluding China On-Highway) increasing by 22% [17][14] Market Data and Key Metrics Changes - The aerospace market saw robust demand growth in both commercial and defense OEMs, with commercial services exceeding forecasts [8][5] - The industrial segment experienced broad-based growth across power generation, transportation, and oil and gas, with marine transportation sales increasing by 38% and oil and gas sales by 28% [17][8] Company Strategy and Development Direction - The company plans to wind down its China On-Highway product lines by the end of the fiscal year, aligning with its long-term growth strategy for the industrial segment [10][19] - Strategic priorities include meeting OEM demand growth, providing world-class service for repair and overhaul, and shifting R&D focus to customer value demonstration [11][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in raising full-year sales and earnings guidance due to strong first-quarter performance and market outlook [12][22] - The company anticipates challenges in supply chain alignment and inventory efficiency, with investments aimed at improving operational capabilities [7][8] Other Important Information - The company expects to incur $20 million to $25 million in costs related to the wind-down of the China On-Highway business, with no revenue spillover expected into FY27 [97][96] - Capital expenditures for fiscal 2026 are projected to increase significantly due to facility buildouts and automation projects [21][20] Q&A Session Summary Question: Will the $245 million of commercial aftermarket sales in the first quarter be the low point for the year? - Management indicated that it is hard to predict if this will be the low point, as they expect increasing repair and spare part sales driven by strong market demand [25] Question: What are the drivers behind the growth acceleration in oil and gas and marine transportation? - Growth in oil and gas is driven by both OEM and services, while marine transportation growth is attributed to increased shipyard output and high fleet utilization [35] Question: How does the company view the profitability of the commercial aerospace OE business? - Management noted that while the profitability is below the blended margin, there are opportunities for improvement through consistent production and supply chain alignment [91] Question: What is the expected impact of the $1.5 trillion 2027 NDAA package on Woodward? - Management stated that it is difficult to predict the impact without visibility into current inventory levels, but they are prepared to respond if demand increases [100]

Financial Data and Key Metrics Changes - In Q1 2026, Woodward reported net sales of $996 million, a 29% increase year-over-year, and earnings per share of $2.17, up from $1.42, reflecting a 54% increase [12][4] - Free cash flow for the first quarter was $70 million, significantly higher than the previous year's $1 million [19][12] - The company raised its full-year sales and earnings guidance based on strong Q1 performance [20][11] Business Line Data and Key Metrics Changes - Aerospace segment sales increased to $635 million, a 29% rise, driven by a 50% increase in commercial services sales [13][12] - Industrial segment sales reached $362 million, up 30%, with core industrial sales (excluding China On-Highway) increasing by 22% [16][12] - The aerospace segment achieved a margin of 23.4%, up from 19.2%, while the industrial segment's margin improved to 18.5% from 14.4% [15][17] Market Data and Key Metrics Changes - Demand in the aerospace sector was robust, particularly in commercial services and defense OEM, with commercial services exceeding forecasts [6][4] - Industrial growth was strong across power generation, transportation, and oil and gas, with marine transportation sales increasing by 38% and oil and gas sales by 28% [7][16] - China On-Highway sales were $32 million, higher than planned, indicating volatility in this market segment [16][17] Company Strategy and Development Direction - The company plans to wind down its China On-Highway product lines by the end of the fiscal year, aligning with its long-term growth strategy [9][18] - Woodward is focusing on expanding service capacity and improving turnaround times, including facility enhancements in Prestwick, Scotland, and Rockford [8][10] - The R&D focus is shifting towards customer value demonstration on selected technologies to increase content on next-generation platforms [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand across markets and the ability to meet OEM growth, despite some supply chain challenges [11][42] - The company anticipates continued benefits from operational excellence and supply chain stabilization, although inventory levels may remain higher than desired [19][21] - Management highlighted the importance of addressing supplier challenges and maintaining production levels to meet customer demand [42][84] Other Important Information - Non-segment expenses for Q1 2026 were $37 million, compared to $22 million in the previous year [18] - Capital expenditures for the quarter were $44 million, with expectations for increased spending in the remaining quarters due to facility buildouts [19] Q&A Session Summary Question: Will the $245 million of commercial aftermarket sales in Q1 be the low point for the year? - Management indicated that it is hard to predict, but they expect increasing repair and spare part sales despite not anticipating the same level of spare LRUs shipping [23] Question: What are the drivers behind the growth acceleration in oil and gas and marine transportation? - Growth was driven by both OEM and services, with high utilization of existing fleets leading to increased overhaul activity [32] Question: How does the profitability of the commercial aerospace OE business compare to the segment average margin? - The commercial aerospace OE business is considerably below the blended margin, with opportunities for improvement through consistent higher rates and supply chain alignment [85] Question: What are the expected costs related to the wind-down of the China On-Highway business? - Expected costs are between $20 million and $25 million, primarily related to personnel and contract cancellations [90] Question: How does the company view the potential impact of the $1.5 trillion NDAA package on spare parts? - Management noted uncertainty regarding the impact, as visibility into current inventory levels is limited [93]

First Quarter Fiscal Year 2026 Results February 2, 2026 Cautionary Statement Information in this presentation contains forward-looking statements regarding future events and our future results within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, including, but not limited to, the results of our ongoing focus on operational excellence, increased output, more consistent execution, and innovation, including whether such focus ultimately leads to susta ...

Financial Performance - Net sales for the first quarter of fiscal year 2026 reached $996 million, representing a 29% increase year-over-year[4] - Net earnings increased to $134 million, a 54% rise compared to the previous year, with earnings per share (EPS) at $2.17, up 53%[4] - Free cash flow for the quarter was $70 million, an increase of $69 million year-over-year[4] - Total consolidated net sales for the three months ended December 31, 2025, reached $996,454,000, a 29% increase from $772,725,000 in the same period of 2024[27] - Net earnings for the three months ended December 31, 2025, were $133,719,000, or $2.17 per share, compared to $87,091,000, or $1.42 per share, in 2024[28] - Adjusted net earnings for the same period were also $133,719,000, reflecting a strong performance without the impact of non-U.S. GAAP adjustments[28] Segment Performance - The Aerospace segment reported sales of $635 million, a 29% increase, with segment earnings of $148 million, reflecting a margin of 23.4%[8] - The Industrial segment achieved sales of $362 million, up 30%, with segment earnings of $67 million and a margin of 18.5%[9] - Aerospace segment net sales were $634,897,000, up 28.5% from $493,882,000 year-over-year, while the Industrial segment net sales increased by 29.6% to $361,557,000 from $278,843,000[27] Guidance and Projections - Based on strong first quarter performance, the company raised its fiscal 2026 sales growth guidance from 7%-12% to 14%-18%[13] - The revised EPS guidance for fiscal 2026 is now projected to be between $8.20 and $8.60, up from the previous range of $7.50 to $8.00[14] - Segment earnings for Aerospace are expected to remain at 22%-23% of sales, while Industrial segment earnings guidance has been raised to 16%-17% of sales[14] Cash Flow and Assets - Net cash provided by operating activities for the three months ended December 31, 2025, was $114,437,000, significantly higher than $34,516,000 in the prior year[25] - Free cash flow for the same period was $70,308,000, compared to only $942,000 in the previous year, indicating strong cash generation capabilities[33] - Total current assets increased to $2,049,123,000 as of December 31, 2025, from $1,884,414,000 at the end of September 2025, driven by higher cash and accounts receivable[24] Debt and Liabilities - The company reported a total debt of $888 million, down from $902 million in the previous year[7] - Total liabilities decreased slightly to $2,146,409,000 from $2,063,753,000, indicating improved financial stability[24] Tax and Expenditures - The effective tax rate for fiscal 2026 is expected to remain around 22%, with no changes to capital expenditures guidance of approximately $290 million[14] - The adjusted effective income tax rate for the three months ended December 31, 2025, was 20.9%, up from 14.0% in the previous year[29] - The company made payments for property, plant, and equipment totaling $44,129,000 during the quarter, compared to $33,574,000 in the same period last year[27]