Woodward (WWD) Surpasses Q4 Earnings And Revenue Estimates

Woodward, Inc. (NASDAQ:WWD) reported fourth-quarter fiscal 2017 earnings of 98 cents per share, beating the Zacks Consensus Estimate of 90 cents by 8.9%. However, the bottom line declined 1% from the prior-year figure of 99 cents.

Full-year earnings of $3.16 per share outpaced the Zacks Consensus Estimate of $3.09 by 2.3%. The figure was also up 10.9% from the year-ago tally of $2.85 per share.

Total Revenues

The company’s quarterly net sales of $606.8 million surpassed the Zacks Consensus Estimate of $599 million by 1.3%. The top line also increased 2.7% from the year-ago figure of $590.9 million, mainly on account of growth in sales witnessed in the Aerospace segment.

Again, fiscal 2017 net sales of $2.10 billion topped the Zacks Consensus Estimate of $2.09 billion by 0.5% and were up 4% from fiscal 2016.

Operational Update

Woodward’s total costs and expenses increased 1.9% year over year to $520 million in the reported quarter. The upside was driven by higher cost of goods sold, selling, general, and administrative expenses and research and development expenses.

Quarterly Segmental Performance

Aerospace: Segment revenues were up 9.3% year over year to $399.1 million, mainly owing to strong defense and commercial programs.

Earnings came in at $85.5 million, up 6.4% on the back of higher sales volume.

Industrial: Segment revenues totaled $23 million, down 8% year over year due to continued weakness in industrial gas turbines and renewable power sales.

Additionally, the bottom line improved 19.6% to $23 million attributable to the company’s cost reduction initiatives, partially offset by the impact of the lower sales volume.

Financial Condition

Woodward’s cash and cash equivalents as of Sep 30, 2017 were $87.6 million compared with $81.1 million as of Sep 30, 2016.

Long-term debt (excluding current portion) was $580.3 million as of Sep 30, 2017, up from $577.2 million as of Sep 30, 2016.

Free cash inflow was $95.1 million in the fiscal fourth quarter compared with $73.2 million in the year-ago quarter.

In fiscal 2017, net cash generated from operating activities was $307.5 million compared with $435.4 million in the prior-year quarter. Also, payments for property, plant and equipment were $92.3 million compared with $175.7 million in fiscal 2016.

Fiscal 2018 Guidance

Woodward expects net sales in the $2.2-$2.3 billion range. Earnings are anticipated in the band of $3.20-$3.50 per share.

Zacks Rank

Woodward has a Zacks Rank #4 (Sell).

Recent Peer Releases

Watts Water Technologies, Inc. (NYSE:WTS) reported third-quarter 2017 adjusted earnings of 80 cents per share, up 13% year over year. Earnings also surpassed the Zacks Consensus Estimate of 78 cents. The company carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Nanometrics Incorporated (NASDAQ:NANO) reported third-quarter 2017 adjusted earnings of 22 cents per share, down 33.3% year over year. The bottom line also outpaced the Zacks Consensus Estimate of 21 cents. The company has a Zacks Rank #4.

Badger Meter Inc.’s (NYSE:BMI) third-quarter 2017 earnings declined 10% year over year to 27 cents per share. Earnings also missed the Zacks Consensus Estimate of 35 cents by a wide margin of 22.9%. The company has a Zacks Rank #5 ( Strong Sell).

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