How Spirit AeroSystems Stock Has Benefited From the Deal To Buy Bombardier’s Aerostructures Business
Spirit AeroSystems (NYSE:SPR), an aerostructures manufacturer, has seen its stock price rally by close to 20% over the last month. While the stock has seen some volatility this year, as its major customer Boeing (which accounts for over 75% of its revenues) faced setbacks with the grounding of its 737 MAX planes, it has seen a slight recovery over the last month or so, driven by a couple of developments. In late October, the company announced that it would acquire Bombardier’s aerostructures business in a $1.1 billion deal. These facilities make components for Airbus planes, potentially allowing the company to diversify its revenue stream, while reducing its dependence on Boeing, to some extent. Separately, the company has been cutting costs and reducing exposure to less profitable businesses.
We ‘step back’ from these recent swings to review Spirit AeroSystems’ performance over the last few years, as a context for what might come next. Our Interactive dashboard, Why Has Spirit AeroSystems Stock Gained 20% Over The Last Month? reviews the near term reasons and the big picture.
The context for the last few years:
A closer look At Spirit AeroSystems’ Total Revenues over the last few years and the outlook
Total Revenues for Spirit AeroSystems Holdings increased from $6,983 Mil in 2017 to $7,222 Mil in 2018; a 3.4% increase. This compares with Total Revenues growth of 2.8% in 2017. We expect Total Revenues growth to be 9.4% in 2019, driven by higher production activity in the Boeing 777, Boeing 787, and A350 XWB programs.
A closer look At Spirit AeroSystems’ Total Expenses over the last few years and the outlook
Total Expense for Spirit AeroSystems Holdings decreased from $6,493 Mil in 2017 to $6,459 Mil in 2018 – a decrease of -0.5%. This compares with Total Expense growth of 6% in 2017. We expect Total Expense to grow by 7.9% in 2019.
How does Spirit AeroSystems’ Revenue Growth compare with rivals?
For more details on how Spirit AeroSystems’ Revenue Growth compares with rivals, view our dashboard analysis.
How has Spirit AeroSystems’ EBT trended?
Earnings Before Taxes (EBT) for Spirit AeroSystems Holdings increased from $535 Mil in 2017 to $756 Mil in 2018 – an increase of 41.5%.
This compares with EBT growth of -19.1% in 2017. We expect EBT growth to be 23% in 2019, driven partly by the stronger revenues.
How has Spirit AeroSystems’ Net Income and EPS trended?
For more details on Spirit AeroSystems’ Net Income and EPS, view our dashboard analysis.
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