Reasons to Add Moog (MOG.A) Stock to Your Portfolio Now
Moog Inc. (MOG.A), with a strong backlog and rising earnings estimates, offers a great investment opportunity in the Aerospace Defense sector.
Let’s focus on the reasons that make this Zacks Rank #2 (Buy) stock a promising investment pick at the moment.
Growth Projections & Surprise History
The Zacks Consensus Estimate for MOG.A’s fiscal 2024 earnings per share (EPS) has increased 1.16% to $6.94 per share in the past 60 days. The Zacks Consensus Estimate for Moog’s total revenues for fiscal 2024 stands at $3.52 billion, which indicates year-over-year growth of 5.95%.
The company delivered an average earnings surprise of 4.87% in the last four quarters.
Return on Equity
Return on equity (ROE) indicates how efficiently a company has been utilizing its funds to generate higher returns. Currently, Moog’s ROE is 12.62% compared with its industry’s average of 12.61%. This indicates that the company has been utilizing its funds more constructively than its peers in the industry.
Rising Backlog
Moog’s solid order activities resulted in a backlog of $2.5 billion at the end of the first quarter of fiscal 2024, which witnessed an improvement of $200 million from the year-ago quarter’s level. This increase was due to higher orders received from their satellite and launch vehicle programs, as well as their Military Aircraft programs, which include the F-35 fighter jet and various funded development programs.
Dividend History
The company has been increasing shareholder value through dividend payments. On Jan 26, 2024, Moog announced a quarterly dividend of 28 cents per share, reflecting an increase of 3.7% from the previous level of 27 cents per share, resulting in an annual dividend of $1.12 per share. Moog’s current dividend yield is 0.73%, better than its Industry’s dividend yield of 0.22%.
Solvency
Moog’s times interest earned ratio (TIE) at the end of the first quarter of fiscal 2024 was 4.3. The strong TIE ratio indicates that the company will be able to meet its interest payment obligations in the near term without any problems.
At the end of the first quarter of fiscal 2024, Moog’s total debt to capital was 35.02%, much better than the industry’s average of 54.43%.
Price Performance
In the past six months, Moog shares have risen 38% compared to its industry’s average return of 21.21%.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks from the same sector are Textron TXT, which sports a Zacks Rank #1 (Strong Buy), and Leidos LDOS and Spire SPIR, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Leidos’ long-term (three to five years) earnings growth rate is pegged at 8.12%. The Zacks Consensus Estimate for the company’s 2024 EPS is pegged at $7.75, which implies a year-over-year increase of 6.16%.
Spire delivered an average earnings surprise of 28.01% in the last four quarters. The Zacks Consensus Estimate for the company’s 2024 EPS stands at a loss of 9 cents, which calls for a year-over-year increase of 95.93%.
Textron’s long-term earnings growth rate is pegged at 10.12%. The Zacks Consensus Estimate for the company’s 2024 EPS is pegged at $6.27, which indicates a year-over-year rise of 12.16%.
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