Spirit AeroSystems Holdings, Inc. (NYSE:SPR) To Fly Higher In New Uptrend


Spirit AeroSystems Holdings, Inc. (NYSE:SPR) declared its third quarter numbers in a press release whose title reminded one of a picnic hamper filled with goodies:

“Spirit AeroSystems Holdings, Inc., Reports Third Quarter 2016 Financial Results; Raises Full-Year Guidance on Revenue, EPS, and Cash; Completed Existing Repurchase Program and Announces New $600 Million Repurchase Program; Initiates Quarterly Dividend of $0.10 Per Share”

See what I mean?

Not surprisingly, the announcement galvanized Spirit Aero to a close of $53.99 Tuesday, up 7.21% with 5.66 million shares traded.

Spirit AeroSystems Holdings, Inc. (NYSE:SPR)’s spirited third quarter beat

For the third quarter, Spirit Aero reported EPS of $1.16 which beat by $0.09 and revenue of $1.71 billion which beat by $70 million and was up by 7.5% year on year. It generated free cash flow of $214 million.

“Our strong performance this year and our five-year financial outlook give us a high degree of confidence in our business,” said Spirit President and CEO Tom Gentile. “After discussions with our Board about capital allocation, we are pleased to announce a new share repurchase program of $600 million and initiate a quarterly dividend of $0.10 per share.”

The financial results received solid tailwind from the “strong operating performance of mature programs.”

Though coincidental, the first dividend quarterly dividend celebrated the company’s 10th anniversary as a public company.

Spirit AeroSystems Holdings, Inc. (NYSE:SPR)’s full year guidance gets a lift

For the full year 2016 Spirit Aero raised its guidance for revenue by $100 million to $6.7 – $6.8 billion, for EPS to a new range of $3.65 – $3.80 from $3.45 – $3.65, and for free cash flow from $350 – $400 million to $400 – $425 million.

Spirit Aero had a work backlog of an estimated $46 billion as at the end of the quarter. “Production rates on the 373, A320, and the A350 are projected to increase throughout the rest of the decade as we execute on our healthy backlog of $46 billion which is almost seven years of sales,” said Sanjay Kapoor, EVP and CFO, on the conference call.

Technically, on the long term monthly chart, Spirit has broken out of a falling flag formation, and is now destined to move much higher. However, in the short term, there could be a pullback towards $50.


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