Source: Moog.

High-performance systems manufacturer Moog (NYSE:MOG-A) (NYSE:MOG-B) has seen its stock soar over the past five years, as the booming aerospace industry helped its largest business segment thrive. In reporting its fiscal fourth-quarter and full-year fiscal 2014 results on Friday, Moog continued to show investors the growth that has justified their excitement about the stock price. Yet even as the shares responded by hitting another record high Friday, investors need to know whether Moog's fundamentals will support further gains from here. Let's take a closer look at how Moog did last quarter.

Moog: Flying high

In its fiscal fourth quarter, Moog showed it could make more from less. Net earnings jumped more than 150% to $40.3 million; even after adjusting for a restructuring charge of $13 million, adjusted earnings per share of $1.12 were higher than the $1.08 per share most investors anticipated. But revenue came in a bit lower than expected at $671.4 million; although that was down less than 1% from the year-ago level, it still reflected some of the industry challenges facing Moog.

Looking at Moog's various segments revealed a much more mixed picture for its fourth quarter. The aircraft controls business continued to show strength, with revenue climbing by 3%, and Moog's components division secured the company's largest sales gain of almost 6%. But revenue from space and defense controls, industrial systems, and medical devices all fell. In particular, space and defense saw mixed results: satellite-component sales plunged, but large gains in missile control and security products helped the defense side offset the space side's falling revenue. The medical devices' revenue decline was largely due to Moog's sale of its Ethox Buffalo unit, which paid off in a major reversal of the segment's prior-year operating loss with a modest profit. Overall, operating-profit gains came almost entirely from the medical devices turnaround, with aircraft controls and space and defense both seeing substantial declines in operating income.

Source: Moog.

For the full year, though, Moog posted sales growth of 1%, to $2.65 billion. Again, improved margins sent profitability much higher, with a 31% gain in net income resulting in earnings per share of $3.52 for fiscal 2014. Revenue growth figures for the full year looked healthier in most of its segments than on a quarter-over-quarter basis, with aircraft controls sales climbing 5% and space and defense and industrial systems coming in flat.

Moog Motion Base System. Source: Moog.

What's next for Moog?

CEO John Scannell described fiscal 2014 as "very respectable year for our company, given the challenging market conditions we faced." Thanks in large part to Moog's success in boosting its margins, Scannell said he believes the company can grow its earnings per share by more than 20% to $4.25, even though he expects only minimal top-line revenue growth to help drive further income gains. In addition, Moog should continue to produce ample free cash flow to give it strategic options either to return capital to shareholders through additional stock buybacks or to make acquisitions to bolster growth. In fiscal 2014, Moog bought back 4 million shares of stock, and further repurchases could send EPS even higher.

That said, Moog faces some challenges. Many of its business segments are cyclical, which explains the disparate results in its units both for the last quarter and for the full year. Moreover, spending on research and development has climbed due to various aircraft certification procedures; as new models roll out from customers Boeing, Airbus, and other aircraft manufacturers, Moog will have to make capital expenditures to ensure it can keep up with competing suppliers.

Overall, Moog has found itself in the right place at the right time, capitalizing on the gains in the aircraft manufacturing industry. Whether it can continue to generate the growth investors want to see, though, depends on whether major aerospace players like Boeing maintain their strong demand for Moog's products. As long as aerospace stays healthy, though, Moog has the potential to keep climbing skyward -- both in its fundamental financial results and in its stock price.