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What: Shares of aerospace and energy components supplier Woodward (Nasdaq: WWD) sank as low as 16% on Monday after the company cut its current-quarter and full-year guidance.

So what: The disappointing third-quarter outlook (EPS of $0.40 versus the consensus of $0.60) coupled with a lower full-year forecast reinforces fears over weakness in parts of the commercial aerospace aftermarket. While Woodward also announced a 10-year deal with Caterpillar (NYSE: CAT) to supply diesel-fuel-injection systems, it wasn't enough to appease investor concerns regarding spiking product development costs and lower sales volumes.

Now what: Management now sees full-year EPS of $1.90 on revenue of $1.85 billion to $1.9 billion, down from its prior view of $2.00 and $1.85 billion to $1.95 billion, respectively. "While our markets may continue to be less predictable quarter-to-quarter as macroeconomic trends unfold, we expect our proven competitive strengths, including industry-advancing innovation and collaborative relationships with leading customers, will continue to serve us well," Chairman and CEO Thomas Gendron reassured investors. With the stock now off about 30% from its 52-week high and trading at a cheapish forward P/E of 12, betting on that long-term bullishness might not be such a bad idea.   

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.

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