For immediate release
Chicago, IL – July 28, 2022 – Zacks.com announces the list of stocks featured in the analyst blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Stocks recently featured in the blog include: Textron Inc. TXT, Northrop Grumman Corp. NOC and L3Harris Technologies LHX.
Here are highlights from Wednesday’s analyst blog:
Second Quarter Aerospace & Defense Results Expected July 28: TXT, NOC and LHX
So far, two S&P 500 companies in the aerospace sector have released their quarterly results in the ongoing earnings cycle, namely Lockheed Martin and Raytheon Technologies. Impressively, both achieved a profit figure above expectations. Another cohort of major aerospace and defense stocks like textron inc., Northrop Grumman Corp. and L3Harris Technologies are expected to announce their earnings on July 28.
Factors Influencing Aerospace & Defense Stocks
The continued recovery in global air travel, both domestic and international, in recent quarters is expected to boost second-quarter results for aerospace and defense stocks, particularly those engaged in commercial aviation. Clearly, Boeing saw a solid 53.2% year-over-year increase in commercial shipments during the second quarter. With Boeing being the nation’s largest jet maker, we expect second-quarter results from other aerospace majors to reflect a similar improvement in delivery trends. These strong deliveries should have boosted the overall revenue growth of the Aerospace sector, which houses all aerospace and defense inventory.
On the other hand, stocks in this industry that are more combat-oriented must have won due to the constant support from the government. Additionally, steady order flow seen over the past two quarters, along with improving shipments of late, supported by the recovery in economic trends, should have supported second-quarter earnings for aerospace stocks and of the defense.
However, continued headwinds like supply chain disruption as well as some unfavorable project schedules due to the coronavirus could negatively impact the overall second quarter results of some of the industry majors.
Second-quarter aerospace profits are expected to decline 7.9% from the year-ago quarter figure, while revenues are expected to edge up 0.4%.
For more details on the quarterly releases, you can browse the latest Revenue overview.
Aerospace & Defense Stocks to Watch
Let’s take a look at three defense companies due to release their second quarter 2022 results on July 28 and find out how things fared ahead of the announcements.
textronQ2 results are expected to reflect mixed segment performance. In particular, strong deliveries of Citation aircraft and commercial turboprops as well as higher spare parts volume are expected to have boosted results in its aerospace segment, while lower military volumes may have hurt the performance of the Bell unit.
Higher commercial deliveries, favorable pricing and increased operating leverage should have bolstered its bottom line in the soon-to-be-released quarter (read more: Will mixed segment performance help Textron’s second quarter earnings?).
According to the Zacks model, the combination of a positive effect ESP Earnings and a Zacks rank of #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of beating earnings. You can see the full list of today’s Zacks #1 Rank stocks here.
Textron has an ESP on earnings of -0.38% and a #3 Zacks rating. You can discover the best stocks to buy or sell before they’re flagged with our Income ESP Filter.
Textron Inc. Price and EPS Surprise
Textron Inc. price-eps-surprise | Submission by Textron Inc.
NorthropIts second-quarter results are expected to reflect moderate growth in the majority of its segment’s sales. While lower manned aircraft and autonomous systems volumes may have contributed unfavorably to the Aerospace segment’s revenue performance, higher volumes in the international armaments program are expected to have contributed favorably to Defense Systems’ revenues in the second quarter. .
Meanwhile, Northrop’s second-quarter earnings may have been negatively impacted by lower FAS/CAS net repo, marketable securities performance and lackluster revenue in the soon-to-be-released quarter.
Northrop has an ESP on Earnings of 0.00% and a Zacks Rank #3 (read more: Will Soft Segmented Sales Hurt Northrop’s Q2 Earnings?).
Price from Northrop Grumman Corporation and surprise EPS
Northrop Grumman Corporation price-eps-surprise | Quote from Northrop Grumman Corporation
L3Harris TechnologiesQ2 results are likely to reflect mixed sales performance across its segments. Improved commercial air traffic and higher electro-optical program volumes are expected to have boosted Integrated Mission Systems revenues, while supply chain constraints may have held back performance in the Communication Systems segment .
Factors such as flight schedule transitions, award timelines and supply chain constraints will impact quarterly business performance.
L3Harris Technologies has a +0.95% Earnings ESP and a #3 Zacks Rank (read more: Will segmental performance hurt L3Harris Q2 earnings?)
L3Harris Technologies Inc Award and EPS Surprise
L3Harris Technologies Inc price-eps-surprise | L3Harris Technologies Inc Submission
Stay up to date with upcoming results announcements with the Zacks Earnings Schedule.
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Past performance is not indicative of future results. The potential for loss is inherent in any investment. This document is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether any investment is suitable for any particular investor. It should not be assumed that investments in the securities, companies, sectors or markets identified and described have been or will be profitable. All information is current as of the date hereof and is subject to change without notice. The views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management of securities. These returns come from hypothetical portfolios composed of stocks with Zacks Rank = 1 that have been rebalanced monthly without transaction fees. These are not the returns of actual stock portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for more information on the performance figures displayed in this press release.
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