Precision Castparts Earnings: Five Quarters in a Row of Expanding Margins, Net Income Climbs

S&P 500 (NYSE:SPY) component PRECISION CASTPARTS CORP (NYSE:PCP) reported its results for the second quarter. Precision Castparts manufactures complex metal components and products and provides investment castings, forgings, and fastener systems for aerospace and industrial gas turbine applications.

Earnings season is back and more important than ever. Get our newest CHEAT SHEET stock picks now


Results: Net income for the metal procurement and fabrication company rose to $332.7 million ($2.28 per share) vs. $294.7 million ($2.04 per share) in the same quarter a year earlier. This marks a rise of 12.9% from the year-earlier quarter.

Revenue: Rose 8.4% to $1.93 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: PRECISION CASTPARTS CORP fell short of the mean analyst estimate of $2.35 per share. It fell short of the average revenue estimate of $2.01 billion.

Quoting Management: “We are currently looking at some strong drivers to top- and bottom-line performance over the next several years,” said Mark Donegan, chairman and chief executive officer of Precision Castparts Corp. “Base commercial aerospace rates continue to increase, and Boeing 787 production is projected to double over the next 12 to 14 months. In addition, we are accelerating our forging throughput to compensate for the press downtime and to meet our customer’s growing schedules. Our aerospace aftermarket sales saw strong demand year over year. The growth of our IGT aftermarket backlog is also showing good momentum.”

Key Stats:

The company has now seen its net income rise for three quarters in a row. In the first quarter, net income rose 19.5% and in the fourth quarter of the last fiscal year, the figure rose 24%.

For two quarters in a row, the company has come in under analyst estimates. In the first quarter, it missed expectations by one cent with net income of $2.35 versus a mean estimate of net income of $2.36 per share.

Looking Forward: For next quarter, analysts have a more positive outlook about the company’s expected results. The average estimate for the third quarter is $2.58 per share, up from $2.57 ninety days ago. The average estimate for the fiscal year is $10.06 per share, down from $10.11 ninety days ago.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

Don’t Miss These Additional Hot Stories:

These Companies Know Exactly When to Restock Shelves

David Einhorn’s New Investment Letter: I’m Still Long These Big Names

Are Facebook Shares Finally a Buy After Earnings?