NEW YORK (TheStreet) -- Woodward (WWD) shares are up 8.3% to $44.81 in trading on Wednesday following the release of the company's second quarter earnings.
While year over year quarterly sales were down -$3 million to $482.5 million, net earnings for the quarter were $44.8 million, or 66 cents per share, beating analysts consensus estimates by 8 cents.
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TheStreet Ratings team rates WOODWARD INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate WOODWARD INC (WWD) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 17.2%. Since the same quarter one year prior, revenues slightly increased by 5.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The current debt-to-equity ratio, 0.53, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.37, which illustrates the ability to avoid short-term cash problems.
- Net operating cash flow has increased to $44.43 million or 11.15% when compared to the same quarter last year. Despite an increase in cash flow, WOODWARD INC's cash flow growth rate is still lower than the industry average growth rate of 27.90%.
- WOODWARD INC's earnings per share declined by 12.8% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, WOODWARD INC increased its bottom line by earning $2.10 versus $2.01 in the prior year. This year, the market expects an improvement in earnings ($2.16 versus $2.10).
- You can view the full analysis from the report here: WWD Ratings Report