Q2 Rundown: Redwire (NYSE:RDW) Vs Other Aerospace Stocks
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Redwire (NYSE:RDW) and the rest of the aerospace stocks fared in Q2.
Aerospace companies often possess technical expertise and have made significant capital investments to produce complex products. It is an industry where innovation is important, and lately, emissions and automation are in focus, so companies that boast advances in these areas can take market share. On the other hand, demand for aerospace products can ebb and flow with economic cycles and geopolitical tensions, which can be particularly painful for companies with high fixed costs.
The 14 aerospace stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.2% while next quarter’s revenue guidance was in line.
The Fed cut its policy rate by 50bps (half a percent) in September 2024, the first in roughly four years. This marks the end of its most pointed inflation-busting campaign since the 1980s. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be assessing whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.
Thankfully, aerospace stocks have been resilient with share prices up 9.8% on average since the latest earnings results.
Redwire (NYSE:RDW)
Based in Jacksonville, Florida, Redwire (NYSE:RDW) is a provider of systems and components used in space infrastructure.
Redwire reported revenues of $78.11 million, up 30% year on year. This print exceeded analysts’ expectations by 14.2%. Despite the top-line beat, it was still a slower quarter for the company with a miss of analysts’ earnings estimates and full-year revenue guidance missing analysts’ expectations.
Redwire pulled off the biggest analyst estimates beat but had the weakest full-year guidance update of the whole group. Unsurprisingly, the stock is up 35% since reporting and currently trades at $7.75.
Is now the time to buy Redwire? Access our full analysis of the earnings results here, it’s free.
Best Q2: Ducommun (NYSE:DCO)
California’s oldest company, Ducommun (NYSE:DCO) is a provider of engineering and manufacturing services for high-performance products primarily within the aerospace and defense industries.
Ducommun reported revenues of $197 million, up 5.2% year on year, outperforming analysts’ expectations by 1.1%. The business had an exceptional quarter with an impressive beat of analysts’ earnings estimates.
The market seems happy with the results as the stock is up 6.2% since reporting. It currently trades at $62.98.
Is now the time to buy Ducommun? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: AerSale (NASDAQ:ASLE)
Providing a one-stop shop that integrates multiple services and product offerings, AerSale (NASDAQ:ASLE) delivers full-service support to mid-life commercial aircraft.
AerSale reported revenues of $77.1 million, up 11.2% year on year, falling short of analysts’ expectations by 12.7%. It was a disappointing quarter as it posted a miss of analysts’ operating margin and earnings estimates.
AerSale delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 12.4% since the results and currently trades at $4.88.
Read our full analysis of AerSale’s results here.
Rocket Lab (NASDAQ:RKLB)
Becoming the first private company in the Southern Hemisphere to reach space, Rocket Lab (NASDAQ:RKLB) offers rockets designed for launching small satellites.
Rocket Lab reported revenues of $106.3 million, up 71.2% year on year. This print was in line with analysts’ expectations. Taking a step back, it was a mixed quarter as it also recorded an impressive beat of analysts’ earnings estimates but revenue guidance for next quarter missing analysts’ expectations.
Rocket Lab scored the fastest revenue growth among its peers. The stock is up 103% since reporting and currently trades at $9.67.
Read our full, actionable report on Rocket Lab here, it’s free.
Howmet (NYSE:HWM)
Inventing the first forged aluminum truck wheel, Howmet (NYSE:HWM) specializes in lightweight metals engineering and manufacturing multi-material components used in vehicles.
Howmet reported revenues of $1.88 billion, up 14.1% year on year. This print surpassed analysts’ expectations by 2.5%. Overall, it was an exceptional quarter as it also produced an impressive beat of analysts’ operating margin estimates and a solid beat of analysts’ Fastening systems revenue estimates.
The stock is up 25% since reporting and currently trades at $103.56.
Read our full, actionable report on Howmet here, it’s free.
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