3 Aerospace/Defense Stocks Moving The Industry Upward

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All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 60 points (0.4%) at 17,039 as of Thursday, Aug. 21, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,834 issues advancing vs. 1,204 declining with 157 unchanged.

The Aerospace/Defense industry as a whole closed the day up 0.4% versus the S&P 500, which was up 0.3%. Top gainers within the Aerospace/Defense industry included Tel Instrument Electronics ( TIK), up 2.0%, Air Industries Group ( AIRI), up 1.8%, LMI Aerospace ( LMIA), up 2.9%, Astrotech ( ASTC), up 2.0% and Elbit Systems ( ESLT), up 1.5%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

Elbit Systems ( ESLT) is one of the companies that pushed the Aerospace/Defense industry higher today. Elbit Systems was up $0.89 (1.5%) to $58.85 on average volume. Throughout the day, 12,328 shares of Elbit Systems exchanged hands as compared to its average daily volume of 15,600 shares. The stock ranged in a price between $58.30-$59.00 after having opened the day at $58.30 as compared to the previous trading day's close of $57.96.

Elbit Systems Ltd., a defense electronics company, designs, develops, manufactures, and integrates defense electronic systems and products worldwide. Elbit Systems has a market cap of $2.5 billion and is part of the industrial goods sector. Shares are down 3.1% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Elbit Systems a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Elbit Systems as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, reasonable valuation levels and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from TheStreet Ratings analysis on ESLT go as follows:

  • Compared to its closing price of one year ago, ESLT's share price has jumped by 32.93%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ESLT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • ELBIT SYSTEMS LTD's earnings per share declined by 10.4% 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, ELBIT SYSTEMS LTD increased its bottom line by earning $4.31 versus $3.98 in the prior year. This year, the market expects an improvement in earnings ($4.43 versus $4.31).
  • The current debt-to-equity ratio, 0.58, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.80 is somewhat weak and could be cause for future problems.
  • ESLT, with its decline in revenue, slightly underperformed the industry average of 1.3%. Since the same quarter one year prior, revenues slightly dropped by 0.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

You can view the full analysis from the report here: Elbit Systems Ratings Report

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