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TheStreet Open House

B/E Aerospace Inc
BEAV : NASDAQ : Industrial Goods
$85.88 -0.18 | -0.21%
Today's Range: 85.02 - 86.23
Avg. Daily Volume: 1,375,800
09/15/14 - 4:00 PM ET

Financial Analysis


B/E AEROSPACE INC's gross profit margin for the second quarter of its fiscal year 2014 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. B/E AEROSPACE INC has weak liquidity. Currently, the Quick Ratio is 0.82 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 21.70% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY14 Q2 FY13
Net Sales ($mil)1089.5850.3
EBITDA ($mil)233.0183.8
EBIT ($mil)198.1161.7
Net Income ($mil)108.692.4


Balance Sheet Q2 FY14 Q2 FY13
Cash & Equiv. ($mil)216.5572.4
Total Assets ($mil)6848.45344.9
Total Debt ($mil)2627.01959.8
Equity ($mil)2858.62348.7


Profitability Q2 FY14 Q2 FY13
Gross Profit Margin40.5241.03
EBITDA Margin21.3821.61
Operating Margin18.1819.02
Sales Turnover0.570.61
Return on Assets5.855.16
Return on Equity14.0211.75
Debt Q2 FY14 Q2 FY13
Current Ratio2.883.67
Debt/Capital0.480.45
Interest Expense31.730.5
Interest Coverage6.255.3


Share Data Q2 FY14 Q2 FY13
Shares outstanding (mil)105.3104.79
Div / share0.00.0
EPS1.040.89
Book value / share27.1522.41
Institutional Own % n/a n/a
Avg Daily Volume1375036.01470565.0

Valuation


BUY. B/E AEROSPACE INC's P/E ratio indicates a premium compared to an average of 21.45 for the Aerospace & Defense industry and a premium compared to the S&P 500 average of 19.81. To use another comparison, its price-to-book ratio of 3.19 indicates a premium versus the S&P 500 average of 2.74 and a discount versus the industry average of 4.55. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. The valuation analysis reveals that, B/E AEROSPACE INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
BEAV 22.48 Peers 21.45   BEAV 28.69 Peers 14.62

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

BEAV is trading at a valuation on par with its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

BEAV is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
BEAV 16.48 Peers 17.56   BEAV 0.85 Peers 1.22

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

BEAV is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

BEAV trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
BEAV 3.19 Peers 4.55   BEAV 44.19 Peers 79.82

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

BEAV is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, BEAV is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
BEAV 2.34 Peers 1.59   BEAV 19.29 Peers 3.67

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

BEAV is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

BEAV has a sales growth rate that significantly exceeds its peers.

 

 

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