PRECISION CASTPARTS Earnings: Double-Digit Growth Again

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

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PRECISION CASTPARTS Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for the metal procurement and fabrication rose to $336.1 million ($2.30 per share) vs. $271 million ($1.87 per share) in the same quarter a year earlier. This marks a rise of 24% from the year-earlier quarter.

Revenue: Rose 16.3% to $1.95 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: PRECISION CASTPARTS CORP beat the mean analyst estimate of $2.27 per share. Analysts were expecting revenue of $1.93 billion.

Quoting Management: “With these solid fourth quarter results, we are taking one more positive step along a clear road to continued top- and bottom-line growth,” said Mark Donegan, chairman and chief executive officer of Precision Castparts Corp. “The commercial aerospace market is robust and shows no signs of slowing down for several years. Boeing and Airbus continue to take up the base production build rates, and the ramp-up of the 787 program is just beginning to get exciting. IGT spores sales are having a good run, and OEM customers have begun to increase the order rate on new turbines as well. Our interconnect pipe sales are also showing signs of life, and we are excited to be at the forefront of new nickel alloy technology that will enable our customers to build power plants operating at higher pressures and temperatures.

Key Stats:

The company has seen double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 16.3%, with the biggest boost coming in the second quarter when revenue rose 18.7% from the year earlier quarter.

The company has now seen its net income increase for three consecutive quarters. In the third quarter, net income rose 19.8% and in the second quarter, the figure rose 17.4%.

The company trumped estimates last quarter after falling shy in the two quarters prior. In the third quarter, it missed the mark by 9 cents, and in the second quarter, it came in under estimates by 2 cents.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past month, the average estimate for the first quarter of the next fiscal year has gone up from $2.31 per share to $2.32. For the fiscal year, the average estimate has moved down from $8.40 a share to $8.39 over the last ninety days.

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

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