Defense Stock Roundup: LHX, SPR, HII Beat on Q2 Earnings, LDOS Misses
In the past five trading sessions, some encouraging earnings news surfaced from the defense space that must have had a favorable impact on the share performance of the defense stocks.
Consequently, major indices of the defense space ended in the green in the trailing five trading sessions. Evidently, the S&P 500 Aerospace & Defense (Industry) index and the Dow Jones U.S. Aerospace & Defense index rose 1.6% and 1.3%, respectively in the trailing five trading sessions.
In the past week, L3Harris Technologies LHX, Leidos Holdings LDOS, Spirit AeroSystems SPR, Huntington Ingalls HII and Curtiss-Wright CW released their Q2 numbers.
Recap of Past Week’s Important Stories
1. L3Harris’ second-quarter 2021 adjusted earnings came in at $3.26 per share, which surpassed the Zacks Consensus Estimate by 2.8% and also increased 15% year over year. Its revenues came in at $4,668 million, exceeding the Zacks Consensus Estimate by 0.5% and improved 5% on a year-over-year basis.
As of Jul 2, 2021, L3Harris had $2,029 million in cash and cash equivalents compared with $1,276 million as of Jan 1, 2021.
The company’s 2021 earnings are now projected to be in the range of $12.80-$13.00 per share, compared with the previous guidance of $12.70-$13.00 (read more: L3Harris Technologies Q2 Earnings Top, Revenues Rise Y/Y).
2. Leidos’ second-quarter 2021 adjusted earnings of $1.52 per share missed the Zacks Consensus Estimate by 3.2% and declined 1.9% year over year. It generated revenues of $3,448 million, which exceeded the Zacks Consensus Estimate by 3.3% and also improved 18.3% year over year.
At the end of the reported quarter, the company’s total backlog was $33.5 billion, up 9% year over year.
Net cash provided by operating activities in the first half of 2021 was $256 million compared with $794 million a year ago (read more: Leidos Holdings Q2 Earnings Miss, Revenues Rise Y/Y).
3. Spirit AeroSystems’ second-quarter 2021 adjusted loss of 31 cents per share came in narrower than the Zacks Consensus Estimate’s loss and also improved on a year-over- year basis. Its revenues of $1,002 million exceeded the Zacks Consensus Estimate by 4.4% and improved 55% year over year.
The company incurred an operating loss of $97.7 million in the second quarter of 2021 compared with an operating loss of $367 million in the prior-year quarter.
Cash outflow from operating activities was $197.7 million at the end of second-quarter 2021 compared with the cash outflow of $559.7 million at the end of second-quarter 2020 (read more: Spirit AeroSystems Q2 Earnings Beat, Revenues Rise Y/Y).
4. Huntington Ingalls Industries’ second-quarter 2021 adjusted earnings of $3.20 per share surpassed the Zacks Consensus Estimate by 28.5% and also improved 146.2% year over year. Its revenues came in at $2,231 million, surpassing the Zacks Consensus Estimate by 5.4% and also increased 10.1% from the year-ago quarter.
Huntington Ingalls received orders worth $1.2 billion during the second quarter.
Cash from operating activities at the end of first-half 2021 grossed $139 million, down from $269 million at the end of first-half 2020 (read more: Huntington Ingalls Q2 Earnings & Sales Beat Estimates).
5. Curtiss-Wright’s second-quarter 2021 adjusted earnings of $1.56 per share surpassed the Zacks Consensus Estimate by 2% and grew 22% on a year-over-year basis. Its total sales of $621 million increased 13% year over year and also exceeded the Zacks Consensus Estimate by 5.4%.
New orders of $679 million increased 11% from the prior-year period.
The company currently expects to generate sales in the range of $2,465-$2,515 million in 2021, compared with the earlier guided range of $2,450-$2,500 million (read more: Curtiss-Wright Q2 Earnings Top Estimates, EPS View Raised)
Performance
Over the past five trading sessions, the defense biggies put up a solid show, except Northrop Grumman NOC. Textron TXT gained the most, with its shares up 5.2% followed by L3Harris.
In the last six months, the industry participants’ performance was impressive. This time also Textron gained the most, with its shares having surged 46% followed once again by L3Harris.
The following table shows the price movement of the major defense players over the past five trading days and during the last six months.
Company | Past Week | Last 6 Months |
LMT | 0.09% | 7.17% |
BA | 1.40% | 9.14% |
GD | 1.56% | 24.71% |
RTX | 0.72% | 20.82% |
NOC | -0.25% | 20.65% |
TXT | 5.22% | 45.98% |
LHX | 2.01% | 25.65% |
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Northrop Grumman Corporation (NOC) : Free Stock Analysis Report
Textron Inc. (TXT) : Free Stock Analysis Report
Spirit Aerosystems Holdings, Inc. (SPR) : Free Stock Analysis Report
Huntington Ingalls Industries, Inc. (HII) : Free Stock Analysis Report
CurtissWright Corporation (CW) : Free Stock Analysis Report
Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report
L3Harris Technologies Inc (LHX) : Free Stock Analysis Report
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