Woodward(US:WWD) ZACKSยท2025-07-29 15:31Core Insights - Woodward, Inc. (WWD) reported third-quarter fiscal 2025 adjusted net earnings per share (EPS) of $1.76, an 8% increase year over year, surpassing the Zacks Consensus Estimate by 8.6% [1] - Quarterly net sales grew 8% year over year to $915 million, exceeding the consensus estimate by 3.1%, driven by strong performance in the Aerospace segment and Core Industrial business [1][2] Financial Performance - The company raised its full-year sales and earnings guidance due to strong year-to-date performance and improved macroeconomic visibility [2] - Free cash flow range was narrowed due to increased working capital needs, with a decline in free cash flow to $99 million from $137 million year over year [3][12] - Stock lost around 2% in pre-market trading following the results announcement, but shares gained 39% over the past six months compared to the Zacks Aerospace - Defense Equipment industry's growth of 20.9% [3] Segment Results - Aerospace segment net sales were $596 million, up 15.2% year over year, driven by strong demand in smart defense and commercial services [4][8] - Defense OEM sales increased 55.7% to $150 million, while commercial after-market sales grew 30% [5] - Industrial segment net sales totaled $319 million, down 3.2% year over year, with transportation sales declining 12% [6][9] Margin and Earnings - Segmental earnings for Aerospace were $126 million, up 23.5% year over year, while Industrial segment earnings fell to $48 million from $60 million in the prior year [6][10] - Gross margin increased by 10 basis points year over year to 27.2%, with total costs and expenses rising 8.7% to $788.6 million [11] Cash Flow and Shareholder Returns - As of June 30, 2025, Woodward had $473.2 million in cash and cash equivalents and $503.9 million in long-term debt [12] - The company returned $62 million to shareholders in the quarter, including $17 million in dividends and $45 million in share repurchases [13] Fiscal 2025 Guidance - Woodward raised its sales guidance to $3.45 billion to $3.525 billion and adjusted EPS guidance to $6.50 to $6.75 [14][16] - Aerospace segment revenues are expected to increase by 11% to 13%, while Industrial sales are anticipated to decline by 5% to 7% [15]