CAE Earnings: Here’s Why the Stock is Falling Now

CAE Inc. (NYSE:CAE) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down 0.97%.

CAE Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 0% to $0.18 in the quarter versus EPS of $0.18 in the year-earlier quarter.

Revenue: Rose 12.29% to $530.4 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: CAE Inc. reported adjusted EPS income of $0.18 per share. By that measure, the company beat the mean analyst estimate of $0.17. It beat the average revenue estimate of $527.84 million.

Quoting Management: “We maintained our market leadership this quarter with strong full-flight simulator sales in Civil and higher orders in Military than last year,” said Marc Parent, CAE’s President and Chief Executive Officer. “In Civil, despite disappointing margin performance this quarter, 23 FFS sales fiscal year to date give us a strong start and we expect to reach a record of 40 units by March 31. The Civil team, led by its new group president, Nick Leontidis, is focused on the execution of its plan and we expect the combined Civil operating margin to reflect the underlying strength of the business by reaching high-teens percentages in the second half of the fiscal year. In Military, we sustained revenue and grew orders over last year which demonstrates our resiliency in a challenging defence budget environment. New Core Markets continued to perform well.”

Key Stats (on next page)…

Revenue decreased 2.97% from $546.63 million in the previous quarter. EPS decreased 14.29% from $0.21 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.19 to a profit $0.18. For the current year, the average estimate has moved down from a profit of $0.81 to a profit of $0.76 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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