TriMas (TRS) Wins Boeing T-7A Contract, Boosts Defense Business
TriMas Corporation (TRS) announced that its RSA Engineered Products business has been awarded multi-year contracts by Boeing BA to provide several components used in fluid conveyance applications, more specifically within the air ducting system. These will be utilized in BA’s new and innovative T-7A Red Hawk training jet program.
With the current deal, TriMas builds on its partnership with Boeing by leveraging its product and process innovation capabilities. Boeing is an important aerospace growth customer for fasteners, low and high pressure ducting, and advance machined and other related components.
The T-7A Red Hawk is an all-new advanced pilot training system for the U.S. Air Force, which will train fighter and bomber pilots in the years to come. This contract win furthers TriMas’ efforts to expand its aerospace product offering into defense-related applications. The company plans to gain additional market share by leveraging a broad value proposition of innovative products and operational excellence.
RSA Engineered Products has worked with Boeing over the past few years to prototype and qualify 38 distinct and highly engineered duct products. For this new deal, it will work closely with Boeing to support the training jet program and is ramping up production capabilities. It expects to ship the production units toward the end of this year.
TriMas’ Aerospace segment, which contributed around 22% of its revenues in 2021, includes the Monogram Aerospace Fastener, Allfast Fastening Systems, Mac Fasteners and Martinic Engineering brands. It is a leading designer and manufacturer of a diverse range of products, including highly-engineered fasteners, collars, blind bolts, rivets and precision-machined components, for use in focused markets within the aerospace industry.
On the second-quarter earnings call, TriMas had maintained its year-over-year sales growth guidance at 8-11% for 2022. Growth will be driven by acquisitions, pick-up in industrial demand and benefits from its diversified end markets. The Aerospace segment's sales are projected to improve 1-3% year over year in 2022 driven by new business awards, market recovery and acquisitions, primarily TFI Aerospace. The segment’s operating margin is expected between 4% and 6%.
The company anticipates the Packaging segment's year-over-year sales growth of 11-14% in 2022, backed by ongoing higher demand for products sold into food & beverage and industrial & agricultural applications, and benefits from Omega and Intertech acquisitions. The segment's operating margin is projected at 18.5-19.5%. Adjusted EPS is expected to be $2.25-$2.35.
Price Performance
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Shares of TriMas have fallen 10.2% in the past year compared with the industry’s decline of 24.3%.
Zacks Rank & Key Picks
TriMas currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the Industrial Products sector are Graphic Packaging Holding Company GPK and Myers Industries MYE. Both flaunt a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Graphic Packaging has an estimated earnings growth rate of 86.8% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 7.6%.
Graphic Packaging pulled off a trailing four-quarter earnings surprise of 7.2%, on average. The company’s shares have appreciated 14.8% in a year.
Myers Industries has an expected earnings growth rate of 67% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 27% in the past 60 days.
MYE has a trailing four-quarter earnings surprise of 20.1%, on average. Myers Industries’ shares have gained 13% in the past year.
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