LMI Aerospace Earnings: Here’s Why the Stock is Falling Now

LMI Aerospace Inc. (NASDAQ:LMIA) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 11.79%.

LMI Aerospace Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 13.95% to $0.37 in the quarter versus EPS of $0.43 in the year-earlier quarter.

Revenue: Rose 52.17% to $105.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: LMI Aerospace Inc. reported adjusted EPS income of $0.37 per share. By that measure, the company missed the mean analyst estimate of $0.38. It missed the average revenue estimate of $112.77 million.

Quoting Management: “Sales of our legacy Aerostructures products and at Valent plants continued to grow, but continued weakness in Engineering Services demand caused overall sales to fall below our estimates,” said Ronald S. Saks, Chief Executive Officer of LMI. “During the second quarter, sales order flow began to slow and that trend will likely continue for the balance of 2013, as delivery of products from some Aerostructures customers were deferred into 2014. Aerostructures deliveries for both the LMI legacy business and Valent are expected to increase in the second half of 2013 yet be lower than previous guidance. Engineering Services backlog stabilized at lower levels, and we expect the results for the second half of 2013 will be similar to the results for the first half.”

Key Stats (on next page)…

Revenue decreased 0.54% from $106.07 million in the previous quarter. EPS increased 164.29% from $0.14 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 $0.56 to a profit $0.50. For the current year, the average estimate has moved down from a profit of $2.03 to a profit of $1.69 over the last ninety days.

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