Why Spirit AeroSystems Holdings, Inc. Slumped

Is this meaningful or just another movement?

Feb 6, 2014 at 11:46AM

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 company Spirit AeroSystems Holdings (NYSE:SPR) sank 17% today after its quarterly results and outlook missed Wall Street expectations.

So what: The stock has soared over the past year on a string of better than expected quarters, but today's Q4 results -- loss of $586.9 million on a revenue increase of 4.8% -- coupled with downbeat guidance is forcing Mr. Market to sober up. Management cited charges related to the 787 program, as well as the establishment of a valuation allowance against deferred tax assets, for the big loss, triggering plenty of concern among investors over its bottom-line growth going forward.

Now what: Management now sees 2014 full-year EPS of $2.50-$2.65 on revenue of $6.5 billion-$6.7 billion, versus the consensus of $2.68 and $6.61 billion. "We're better positioned to move forward as we ramp up alongside our customers to all-time historical highs in commercial aircraft production rates," President and CEO Larry Lawson reassured investors. "We are entering 2014 with a strong cost discipline and relentless focus on performance and accountability that should begin to yield consistent cash generation." More important, with the stock now off 25% its 52-week highs and trading at a forward P/E of 10, Mr. Market might be offering a good chance to buy into that bullishness.

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Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Spirit AeroSystems Holdings. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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