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HEICO (HEI) Q2 Earnings Surpass Estimates, Sales Rise Y/Y

HEICO Corporation’s HEI second-quarter fiscal 2024 earnings per share (EPS) of 88 cents beat the Zacks Consensus Estimate of 80 cents by 10%. The bottom line also improved 15.8% from the prior-year quarter’s 76 cents.

Total Sales

The company’s net sales increased 38.9% year over year to $955.4 million in the reported quarter. The figure also beat the Zacks Consensus Estimate of $944 million by 1.3%.

The year-over-year upside was driven by increased sales volume from both the Flight Support Group and Electric Technologies Group segments.

Heico Corporation Price, Consensus and EPS Surprise

Heico Corporation Price, Consensus and EPS Surprise
Heico Corporation Price, Consensus and EPS Surprise

Heico Corporation price-consensus-eps-surprise-chart | Heico Corporation Quote

Operational Update

HEICO’s cost of sales increased 38.5% year over year to $583.6 million in the quarter under review. The company’s selling, general and administrative expenses increased 48.6% to $162.6 million.

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Interest expense of $38.5 million increased a massive 238.6% from $11.4 million in the prior-year quarter.

Segmental Performance

Flight Support Group: Net sales from this segment surged 65% year over year to $647.2 million. This rise was driven by strong organic growth of 12% and the positive impact of its fiscal 2024 acquisitions.

The segment’s operating income soared 49% year over year to $148.9 million. This increase was due to solid net sales growth.

Electronic Technologies Group: The segment’s net sales increased 6% to $319.3 million, primarily driven by organic growth of 4%.

The segment’s operating income rose 11% year over year to $75.3 million, primarily driven by improved gross profit margin and net sales growth.

Financial Details

As of Apr 30, 2024, HEI’s cash and cash equivalents totaled $204.2 million compared with $171 million as of Oct 31, 2023.

Cash flow provided by operating activities was $252.8 million during the six months ending Apr 30, 2024, implying a 63.7% rise from the prior-year period’s level.

HEICO reported long-term debt (net of current maturities) of $2.39 billion as of Apr 30, 2024, down from $2.46 billion as of Oct 31, 2023.

Zacks Rank

HEICO currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Defense Releases

L3Harris Technologies, Inc. LHX reported first-quarter 2024 adjusted earnings (from continuing operations) of $3.06 per share, which beat the Zacks Consensus Estimate of $2.89 by 5.9%. The bottom line also increased 7% from the year-ago quarter’s reported figure of $2.86.

L3Harris’ first-quarter revenues totaled $5.21 billion, which beat the Zacks Consensus Estimate of $5.11 billion by 2%. The top line also rose 16.6% from the year-ago quarter’s level of $4.47 billion.

Lockheed Martin Corporation LMT reported first-quarter 2024 adjusted earnings of $6.33 per share, which beat the Zacks Consensus Estimate of $5.80 by 9.1%. However, the bottom line declined 1.6% from the year-ago quarter's recorded figure of $6.43.

Its net sales were $17.20 billion, which surpassed the Zacks Consensus Estimate of $16.19 billion by 6.2%. The top line also increased 13.7% from $15.13 billion reported in the year-ago quarter.

Hexcel Corporation HXL reported first-quarter 2024 adjusted earnings of 44 cents per share, which came in line with the Zacks Consensus Estimate.

In the first quarter, the company’s net sales totaled $472.3 million, which missed the Zacks Consensus Estimate of $475 million by 0.6%. However, the top line witnessed an improvement of 3.2% from the year-ago quarter’s reported figure of $457.7 million.

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