Why Triumph Group Tanked Today

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of aerospace equipment company Triumph Group  (NYSE: TGI  ) plunged 10% today after its quarterly results and outlook missed Wall Street expectations.

So what: The stock has rebounded in recent months on signs of strengthening demand, but today's fiscal-2014, third-quarter results -- adjusted earnings per share of $0.99 missed the consensus by $0.23 on a revenue increase of just 3% -- coupled with downbeat guidance is forcing Mr. Market to quickly sober up. In fact, adjusted EBITDA margin decreased 550 basis points from the year-ago period to 12.7%, suggesting the company's competitive position is getting more expensive to maintain.

Now what: Management now sees 2014 EPS of $4.75 on revenue of $3.8 billion, down from its prior view of $5.25 and roughly $3.9 billion. "We continue to make excellent progress with the Jefferson Street to Red Oak transition which remains on schedule and on budget," President and CEO Jeffry Frisby reassured investors. "Strategically, we expanded our relationship with Airbus by securing the recently announced award to provide machined and assembled structural components for the fuselage structure which support the cabin storage bins and aircraft systems for the Airbus A350 XWB." With the stock hitting a new 52-week low today and trading at a cheapish forward P/E of 10, now might even be an opportune time to buy into that bull talk.

More compelling ways to build wealth
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2814771, ~/Articles/ArticleHandler.aspx, 8/2/2014 6:18:27 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement