Momentum: Esterline Technologies (ESL)

Esterline Technologies Corp (ESL) recently hit a new multi-year high after reporting an solid 9% Q2 earnings surprise in early September.

Company Description

Esterline Technologies Corp. designs and manufactures engineered products and systems for the Aerospace and defense, industrial and commercial and medical markets primarily in the United States and Europe. The company was founded in 1967 and has a market cap of $1.77 billion.

Shares of ESL jumped higher on September 2 after the company reported strong Q2 results that handily beat expectations.

Second-Quarter Results

Revenue for the period was up 6% from last year to $383 million. Earnings also came in strong at $1.30, 9% ahead of the Zacks Consensus Estimate and up from $1.09 in the same period last year.

The company saw its biggest gains in Avionics and Controls, where sale were up 12% from last year to $194 million.

Esterline also scored on its margins, where gross margin expanded to 34.3% from 32.4% from last year general cost control measures and lower fixed costs on higher sales volume.

Balance Sheet

Esterline also used the good quarter to strengthen its balance sheet and improve liquidity, with cash and equivalents up $134 million from last year to $293 million while its total debt increased $12 million to $544 million.


With the company raising its guidance on the good quarter, the analysts were quick to do the same, with the current year up 27 cents to $3.87 and the next-year estimate also gaining 27 cents to $4.19, a solid 8% growth projection.


The valuation picture looks solid too, with ESL’s forward P/E of 15X in line with the industry average.

2-Year Chart

On the chart, share have been in a general up trend for the last 18 months before recently spiking higher on the solid quarter. The MACD below the chart is looking bullish too, with the short-term average jumping ahead of the long-term average. The all-time high is close at hand, take a look below.

ESTERLINE TECHN (ESL): Free Stock Analysis Report

About Michael Vodicka 49 Articles

Affiliation: Zacks Investment Research

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