Canada occupies fifth place in the global aerospace production rankings.
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New York State-based Astronics Corp. is a supplier of products to the aerospace, defense, consumer electronics and semi-conductor industries. Its products include advanced, high-performance lighting and safety systems, electrical power generation and distribution systems, aircraft structures, avionics products and automatic test systems. It has operations in the United States, Canada and France and has a market cap of $1-billion (U.S.).
Astronics has grown earnings at a 24-per-cent pace over the long term (using an average of the 3-, 4- and 5-year EPS growth rates), which the Peter Lynch based model likes. The Lynch model also likes its 0.56 PE-to-growth ratio.
The Martin Zweig-based model likes that its EPS growth has been fueled by revenue growth - the firm has grown revenues at a 39-per-cent pace (using an average of the 3-, 4- and 5-year sales growth rates). The Zweig-based model also likes that EPS growth accelerated to 42 per cent last quarter.
Debt/equity of 73 per cent is well below aerospace and defense average of 106 per cent.
The company has averaged a 22.2-per-cent return on retained earnings (those not paid out as dividends) over the past decade, which the Warren Buffett model likes.
Astronics also has a reasonable 1.4 price/sales ratio and has a strong 29-per-cent return on equity (TTM).
John Reese is long ATRO.
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