Five things to know ahead of today's opening bell. Shares of industrial giant Caterpillar, they are down in the pre-market. The company says that tariff related costs will be higher than previously forecast.For 2025, CAT is now expecting a tariff hit of between 1.5% and$ 1.8% billion. That's up from its guidance earlier this month of up to$ 1.5% billion. Meanwhile, shares of retailer Gap, they're under pressure.retailer that has Gap and Outer Republic Old Navy brands all saw comp sales increase, but Athleti ...

Financial Data and Key Metrics Changes - Total sales for FY 2025 reached $19.9 billion, with a record adjusted segment operating margin of 26.1%, an increase of 120 basis points from the prior year [5][14] - Adjusted EBITDA margin was 26.4%, up 80 basis points year-over-year, and adjusted EPS grew by 7% [5][14] - Cash flow from operations was a record $3.8 billion, representing 19% of sales, with free cash flow also at a record $3.3 billion or 16.8% of sales [29] Business Line Data and Key Metrics Changes - Aerospace segment achieved record sales of $6.2 billion, reflecting 13% organic growth and a backlog of $7.4 billion [6][14] - Industrial segment recorded an adjusted segment operating margin of 25.1%, a 90 basis point increase from the previous year [8] - Aerospace Systems sales reached $1.7 billion, up 10% year-over-year, with adjusted segment operating margins increasing by 190 basis points to a record 29% [27] Market Data and Key Metrics Changes - North America sales were $2.1 billion, with organic growth down 1%, but adjusted operating margins increased by 170 basis points to a record 26.7% [23] - International sales were $1.5 billion, up 4%, with organic growth positive at 1% [25] - Aerospace orders increased by 12%, indicating strong demand in the aftermarket channels [27] Company Strategy and Development Direction - The company is focused on its "Power of the Win Strategy," which aims to drive performance across all economic climates and enhance margin expansion [3][12] - The recent acquisition of Curtis Instruments is expected to expand the company's electrification offerings and enhance its capabilities in low voltage motor control solutions [10][11] - The company anticipates that 85% of its portfolio will consist of longer cycle secular and aftermarket by FY 2026 [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving another record year for FY 2026, with guidance indicating 8% organic growth in aerospace and low single-digit growth in industrial segments [30][31] - The company noted challenges in the transportation market, expecting a mid-single-digit organic decline, while construction and energy markets show signs of recovery [31][32] - Management emphasized a disciplined capital deployment strategy and the importance of maintaining strong cash flow generation [29][44] Other Important Information - The company finished FY 2025 with a record backlog of $11 billion, indicating strong future demand [6] - Adjusted net income for Q4 was $992 million, reflecting an 18.9% return on sales [16] - The company repurchased $850 million in shares during the quarter, totaling $1.6 billion for the year [29] Q&A Session Summary Question: Can you discuss the Q1 guide and the sequential step down in EPS? - Management acknowledged the sequential challenges but highlighted that Q1 EPS guidance reflects a $0.05 increase year-over-year with margin expansion [49][50] Question: What are the expectations for the industrial short cycle businesses? - Management noted positive distributor sentiment and gradual recovery in industrial sectors, with expectations for low single-digit growth [55][56] Question: Can you elaborate on the Curtis acquisition and its margin profile? - Management indicated that while Curtis's initial margins may be dilutive, they expect significant synergy and accretion within three years [65][66] Question: How are international orders performing? - Management explained that international orders were flat due to tough comparisons, but overall order dollars remained stable [71] Question: What is the outlook for aerospace orders? - Management reported strong demand driven by increasing commercial transport rates and a growing defense budget, with expectations for continued growth [111][112]

Core Insights - ON Semiconductor (ON) reported second-quarter 2025 non-GAAP earnings of 53 cents per share, missing the Zacks Consensus Estimate by 1.85% and declining 44.8% year over year [1][7] - Revenues reached $1.47 billion, exceeding the Zacks Consensus Estimate by 1.5% but down 15.4% year over year, surpassing the company's guidance range of $1.4 to $1.5 billion [1][7] Revenue Breakdown - Automotive segment, accounting for 50% of revenues, generated $733.2 million, a decrease of 19.2% year over year [2] - Industrial segment, representing 27.7% of revenues, saw revenues decline 13.2% year over year to $406.2 million [2] - Other segments, making up 2.4% of revenues, reported a decline of 8.6% year over year to $329.3 million [2] Segment Performance - Power Solutions Group revenues were $698.2 million, contributing 47.5% to total revenues, down 16.4% year over year [3] - Analog & Mixed Group revenues totaled $555.9 million, accounting for 37.8% of revenues, declining 14.2% year over year [3] - Intelligent Sensing Group revenues reached $214.6 million, representing 14.6% of revenues, falling 14.9% year over year [3] Margin and Expenses - Non-GAAP gross margin contracted by 770 basis points year over year to 37.6%, slightly above the management's guidance range of 36.5% to 38.5% [3] - Non-GAAP operating expenses decreased 3.5% year over year to $297.7 million, exceeding the guidance of $285-$300 million [4] - Non-GAAP operating margin was reported at 17.3%, down from 27.5% in the same quarter last year [4] Balance Sheet and Cash Flow - As of July 4, 2025, ON had cash and cash equivalents of $2.83 billion, down from $3.01 billion as of April 4, 2025 [5] - Long-term debt remained unchanged at $3.35 billion [5] - Cash flow from operations for the second quarter of 2025 was $465.8 million, down from $602.3 million in the previous quarter [5] - Free cash flow amounted to $304.1 million, compared to $454.7 million in the previous quarter [5] Q3 Guidance - For Q3 2025, ON expects revenues between $1.465 billion and $1.565 billion [6] - Non-GAAP gross margin is projected to be in the range of 36.5% to 38.5% [6] - Non-GAAP operating expenses are anticipated to be between $280 million and $295 million [8] - Non-GAAP earnings are expected to range from 54 cents to 64 cents per share [8]

Summary of Key Points from the Conference Call Industry Overview - The report discusses the current state of global markets, particularly focusing on trade policy uncertainty, monetary policy expectations, and macroeconomic data trends. Core Insights and Arguments 1. **Market Conditions**: The Euro area composite flash PMI rose to 51.0, indicating positive growth momentum. The S&P 500 reached new all-time highs, supported by a 'Goldilocks' regime characterized by favorable growth conditions and risk asset returns [1][8]. 2. **Trade Policy Uncertainty**: Trade policy uncertainty has decreased to its lowest level since January, with recent trade agreements between Japan and the US, as well as the EU and US, setting reciprocal tariffs at 15%. This has positively impacted Japanese equities, particularly in the Autos and Industrial sectors [2][21]. 3. **Monetary Policy Expectations**: Expectations for monetary policy have shifted to a less dovish stance, with the ECB indicating a "wait and see" approach. The FOMC and BoJ are also expected to maintain current rates. This shift is reflected in the flattening of the 2s10s curves across G4 economies [3][17]. 4. **Earnings Season Performance**: The Q2 earnings season in the US has surprised positively, with markets pricing in larger moves for individual stocks compared to the index. Speculative trading activity has increased, which may support near-term equity returns [3][19]. 5. **Asset Allocation Strategy**: The asset allocation remains tactically neutral and modestly pro-risk for the next 12 months. The current 'Goldilocks' regime is expected to persist, driven by falling trade uncertainty and supportive macro data [4][7]. Additional Important Insights 1. **GDP Growth Forecasts**: Japan's GDP growth forecast has been revised upward by 0.2 percentage points for FY'25/'26 following the trade agreement announcements [2][10]. 2. **Market Volatility**: The report notes that markets are currently pricing in 2.4 times larger moves for the average stock compared to the index, indicating heightened volatility expectations [3][19]. 3. **Sector Performance**: The rally in Japan was led by cyclical sectors, particularly Autos and Industrials, as defensive sectors were repriced higher [2][10]. 4. **Future Economic Indicators**: Upcoming economic indicators, including US NFPs, ISM, and advance GDP prints, are expected to provide further insights into the economic landscape [7][21]. This summary encapsulates the key points from the conference call, highlighting the current market dynamics, trade policy developments, and monetary policy expectations that are shaping investment strategies.

Financial Performance - Third quarter fiscal year 2025 net sales increased by 8% year-over-year, from $848 million to $915 million[16] - Third quarter fiscal year 2025 net earnings increased by 6% year-over-year, from $102 million to $108 million[16] - Third quarter fiscal year 2025 earnings per share (EPS) increased by 8% year-over-year, from $1.63 to $1.76[16] - Year-to-date free cash flow was $159 million[8], a decrease of 29% compared to $225 million in the prior year[18] Segment Results - Aerospace segment sales increased by 15% in the third quarter, from $518 million to $596 million[28] - Aerospace segment earnings increased by 24% in the third quarter, from $102 million to $126 million[28] - Core Industrial sales increased by 9% in the third quarter, from $277 million to $303 million[47] - Industrial segment sales decreased by 3% in the third quarter, from $330 million to $319 million[45] Industrial Segment Challenges - Industrial segment earnings decreased by 20% in the third quarter, from $60 million to $48 million[45] - China on-highway natural gas truck sales significantly declined, impacting the Industrial segment[8, 20, 23] - China on highway natural gas truck sales decreased from $53.085 million to $16.589 million for the three months ended June 30, 2024 and 2025 respectively[72] Aerospace Market Dynamics - Commercial Services sales in Aerospace grew by 30%[35] - Defense OEM sales in Aerospace grew by 56%[36] Fiscal Year 2025 Guidance - Revised sales guidance for fiscal year 2025 is $3.45 billion to $3.525 billion[60] - Adjusted EPS guidance for fiscal year 2025 is $6.50 to $6.75[60]

Core Insights - Woodward, Inc. raised its 2025 sales and earnings guidance due to strong year-to-date performance and a positive outlook for the fourth quarter [1][5] - The company reported third-quarter net sales of $915 million, an 8% increase year-over-year, and year-to-date sales of $2.6 billion, a 4% increase [4][6] - Net earnings for the third quarter were $108 million, up 6% from the previous year, with earnings per share (EPS) of $1.76, an 8% increase [4][6] Financial Performance - Third-quarter net sales reached $915 million, compared to $848 million in the same quarter last year, marking an 8% increase [4][6] - Year-to-date net sales totaled $2.6 billion, up 4% from $2.47 billion in the prior year [4][6] - Net earnings for the third quarter were $108 million, a 6% increase from $102 million in the same quarter last year [4][6] - Year-to-date net earnings were $304 million, up 5% from $290 million in the previous year [4][6] - The company reported an adjusted EPS of $4.80 for the year-to-date period, a 2% increase from $4.70 [4][6] Segment Performance - The Aerospace segment generated significant sales growth of 15.2% in the third quarter, with total sales of $596 million compared to $518 million in the prior year [9][26] - The Industrial segment saw a slight decline in sales, with $319 million reported in the third quarter, down 3.2% from $330 million [11][26] - The Aerospace segment's earnings increased by 23.5% to $126 million, while the Industrial segment's earnings decreased by 20.3% to $48 million [9][11][26] Cash Flow and Guidance - Cash from operations decreased by 18% to $126 million in the third quarter, and free cash flow fell by 28% to $99 million [7][4] - The company is lowering its full-year free cash flow guidance due to increased demands in a dynamic supply chain environment [5] - Revised guidance for total company sales is now projected between $3.45 billion and $3.525 billion, with adjusted EPS expected to be between $6.50 and $6.75 [15]

Core Viewpoint - Stanley Black & Decker, Inc. is expected to report a decline in both revenues and adjusted earnings for the second quarter of 2025, with revenues projected at $3.99 billion, down 0.9% year-over-year, and adjusted earnings expected to fall 65.1% to 38 cents per share [1][9]. Revenue Performance - The consensus estimate for Stanley Black's second-quarter revenues is $3.99 billion, indicating a decline of 0.9% from the previous year [1][9]. - The Tools & Outdoor segment is anticipated to see a revenue increase of 1.6% year-over-year to $3.58 billion, driven by strong demand in the DEWALT business and other key brands [3][9]. - Conversely, the Industrial segment is expected to experience a revenue decline of 10.3% year-over-year to $444.9 million, impacted by softness in the automotive market and the divestiture of the infrastructure business [5][9]. Earnings Performance - The adjusted earnings consensus estimate is set at 38 cents per share, reflecting a significant decline of 65.1% from the same quarter last year [1][9]. - The company has a history of earnings surprises, having outperformed consensus estimates in the last four quarters with an average surprise of 18.4% [2]. Cost and Margin Analysis - Stanley Black's cost-reduction initiatives are expected to support its bottom line, with an anticipated EBITDA margin of 6%, representing a 70 basis points year-over-year expansion [4]. - Selling, general, and administrative (SG&A) expenses are projected to rise by 10.8% year-over-year to $887.3 million, which may pressure the company's overall profitability [6]. Foreign Exchange Impact - The company's operations are subject to foreign exchange headwinds, with a stronger U.S. dollar likely negatively affecting its overseas business [6].

It is time. It's time for the light round. Yes.Go. Save the stock. Tell by sell.Just be clear. I know the course. I tell my step to grab to apply.You're playing the sound. And then the lightning round is over. Are you ready.Ski daddy. Tell me the light. Harry in Georgia. Harry. Harry in Atlanta, Georgia.Club member. Yes. and the home of Atlanta to CocaCola and Home Depot.And my question tonight, UPS, you know what. UPS is a real quandry. I love that yield, but I do think the fundamentals are still hurting.I ...

Group 1 - Industrial stocks are currently receiving less attention from investors, despite the presence of strong businesses in the sector [1] - Hubbell Inc. (NYSE: HUBB) is highlighted as a company that may be overlooked by many investors [1]

Group 1: Market Trends - Stocks near all-time or 52-week highs indicate strong bullish sentiment, with buyers in control [1] - Stocks making new highs are likely to continue rising, especially with positive earnings estimate revisions [8] Group 2: Credo Technology Group (CRDO) - Credo Technology, rated Zacks Rank 1 (Strong Buy), offers innovative high-speed connectivity solutions, benefiting from the AI surge [3][4] - The company reported a remarkable 180% year-over-year increase in sales, significantly exceeding consensus expectations [5] - The outlook for Credo remains bullish due to sustained demand and increased AI spending [4] Group 3: Heico (HEI) - Heico, also rated Zacks Rank 1 (Strong Buy), operates in aerospace, industrial, defense, and electronics sectors, with products used in various aircraft [9] - The company achieved record Q2 sales and net income, with sales growing 15% and net income increasing by 27%, surpassing consensus expectations [10] - Both segments of Heico, Flight Support and Electrical Technologies, experienced sales growth of 19% and 7%, respectively, with an operating margin increase to 22.6% from 21.9% year-over-year [10]