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Shares Of Woodward Governor Soar On 2Q Earnings

The Associated Press

HARTFORD, Conn. (AP) — Shares of Woodward Governor Co. soared Thursday, a day after the manufacturer of aircraft energy control systems reported second-quarter earnings which soundly beat Wall Street expectations, and boosted the bottom-end of its full-year outlook.

On Wednesday, the company reported earnings of $18.5 million, or 27 cents per share. Excluding restructuring charges, its adjusted profit amounted to 43 cents per share, trouncing Wall Street's target of 34 cents per share.

Revenue rose 9 percent to $334.7 million, and topped analysts' estimate of $327.8 million, according to a survey by Thomson Reuters.

The company also raised its full-year earnings outlook to $1.45 per share to $1.65 per share, from a prior view of $1.40 per share to $1.65 per share. Woodward Governor also upped its revenue projection to $1.4 billion to $1.5 billion, from previous guidance of $1.3 billion to $1.4 billion in revenue.

Analysts surveyed by Thomson Reuters expect 2009 earnings of $1.43 per share on revenue of $1.47 billion.

Analyst Peter Lisnic of Robert W. Baird Ltd. said Woodward Governor's second-quarter results were "solidly above" his forecast, led by growth and margins in its turbine business.

In a note to investors Thursday, Lisnic upgraded the Fort Collins, Colo., company to "Outperform" from "Neutral" and increased his price target to $24 from $15. That price target implies a 60 percent increase from the $15 closing price Wednesday.

He also increased his fiscal 2009 earnings to $1.60 per share from $1.55 per share to incorporate the second quarter results "and stronger growth and profitability expectations" for the company's turbine business, partially offset by lower assumptions on its engine unit.

And Lisnic raised his fiscal 2010 earnings to $1.85 per share from $1.80 per share.

Analysts surveyed by Thomson Reuters expect earnings of $1.70 per share in 2010.

Shares rose $3.40, or 22.7 percent, to $18.40 in morning trading.