The 10-second takeaway
For the quarter ended March 30 (Q2), TransDigm Group met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue grew. Non-GAAP earnings per share increased. GAAP earnings per share contracted significantly.
Margins contracted across the board.
TransDigm Group reported revenue of $465.6 million. The 13 analysts polled by S&P Capital IQ foresaw revenue of $468.8 million on the same basis. GAAP reported sales were 10.0% higher than the prior-year quarter's $423.5 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.74. The 14 earnings estimates compiled by S&P Capital IQ anticipated $1.73 per share. Non-GAAP EPS of $1.74 for Q2 were 5.5% higher than the prior-year quarter's $1.65 per share. GAAP EPS of $1.25 for Q2 were 17% lower than the prior-year quarter's $1.51 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 55.7%, 150 basis points worse than the prior-year quarter. Operating margin was 41.7%, 220 basis points worse than the prior-year quarter. Net margin was 14.6%, 470 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $487.5 million. On the bottom line, the average EPS estimate is $1.85.
Next year's average estimate for revenue is $1.88 billion. The average EPS estimate is $6.92.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 364 members out of 381 rating the stock outperform, and 17 members rating it underperform. Among 140 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 135 give TransDigm Group a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on TransDigm Group is outperform, with an average price target of $157.00.
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