Update (9:45 a.m.): Updated with Tuesday market open information.
NEW YORK (TheStreet) -- RBC Capital upgraded Wesco Aircraft (WAIR) to "outperform" from "sector perform" and set a $27 target price. The firm noted the company can grow organically and through acquisitions.
The stock was rising 1.7% to $22.71 at 9:42 a.m. on Tuesday.
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Separately, TheStreet Ratings team rates WESCO AIRCRAFT HOLDINGS INC as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate WESCO AIRCRAFT HOLDINGS INC (WAIR) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows low profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 31.57% and other important driving factors, this stock has surged by 62.87% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WAIR should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- WESCO AIRCRAFT HOLDINGS INC has improved earnings per share by 31.6% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, WESCO AIRCRAFT HOLDINGS INC increased its bottom line by earning $1.09 versus $0.96 in the prior year. This year, the market expects an improvement in earnings ($1.34 versus $1.09).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Transportation Infrastructure industry average. The net income increased by 32.3% when compared to the same quarter one year prior, rising from $18.43 million to $24.37 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 14.5%. Since the same quarter one year prior, revenues slightly increased by 6.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- WAIR's debt-to-equity ratio of 0.64 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that WAIR's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.94 is high and demonstrates strong liquidity.
- You can view the full analysis from the report here: WAIR Ratings Report