TransDigm (TDG) Q2 Earnings Beat Estimates, Sales Increase Year-over-Year

TransDigm Group Incorporated TDG reported adjusted earnings of $3.86 per share for the second quarter of fiscal 2022, which beat Zacks’ consensus estimate of $3.71 by 4%. Net income improved 50% from the $2.58 reported a year ago.

Excluding one-time items, the company reported GAAP earnings of $3.38 per share, compared to $1.79 generated in the year-ago quarter.

This year-over-year improvement can be attributed to higher net sales, a favorable sales mix, as well as lower one-time refinancing costs as well as restructuring costs related to COVID- 19 lower.

Sales

Net sales were $1,327 million in the fiscal second quarter, up 11.1% from $1,194 million in the prior year quarter. The reported figure also topped Zacks’ consensus estimate of $1.31 million by 1.5%.

Transdigm Group Incorporated price, consensus and surprise EPS

Transdigm Group Incorporated price-consensus-eps-surprise-chart | Quote from Transdigm Group Incorporated

Operating results

Gross profit for the quarter increased 24.3% to $736 million from $592 million in the comparable quarter a year ago.

As a result, operating income jumped 32% year over year to $520 million.

Financial situation

TransDigm ended the second quarter of fiscal 2022 with cash and cash equivalents of $4,216 million, compared to $4,787 million at September 30, 2021.

At the end of the second fiscal quarter, the company’s long-term debt stood at $19.39 billion, up slightly from $19.37 billion as of September 30, 2021.

Cash flow from operating activities was $366 million as of April 2, 2022, compared to $372 million as of April 3, 2021.

Orientation

Given the continued disruptions in TransDigm’s key commercial end markets, thanks to the impact of the COVID-19 pandemic, the company has once again refrained from providing guidance for fiscal year 2022.

Zacks Rank

TransDigm currently carries a Zacks rank #4 (sell).

You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Defense Publications

Raytheon TechnologiesRTX’s Q1 2022 adjusted earnings per share (EPS) of $1.15 beat Zacks’ consensus estimate of $1.01 by 13.9%. Additionally, net income improved 27.8% from adjusted earnings of 90 cents in the prior year quarter.

Raytheon’s first-quarter sales of $15,716 million beat Zacks’ consensus estimate of $15,799 million by 0.5%. Revenue, however, increased 3% from $15,251 million in the prior year quarter.

Lockheed Martin LMT reported earnings of $6.44 per share in the first quarter of 2022, which beat Zacks’ consensus estimate of $6.22 by 3.5%. Net income, however, was down 1.8% year-on-year.

Lockheed Martin’s net sales were $14.96 billion, which beat Zacks’ consensus estimate of $15.53 billion by 3.7%. Revenue also fell 8% from the $16.26 billion reported in the prior year quarter.

Teledyne Technologies Inc.. TDY reported first-quarter 2022 adjusted earnings of $4.27 per share, which beat Zacks’ consensus estimate of $4.09 by 4.4%. Net income also improved 33.9% from $3.19 per share in the prior year quarter.

Teledyne’s total first-quarter sales were $1,321 million, which beat Zacks’ consensus estimate of $1,315 million by 0.5%. Revenue also improved 64% from the $805.7 million reported a year ago.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Sallie R. Loera