Astronics shares have soared over the past few weeks after excellent results from the company. The shares rose $1.86, or 5.6 percent, to $35.27 in afternoon trading. They had slipped nearly 7 percent in 2012 through Friday, and have ranged between $19.70 and $38.02 in the past 52 weeks. The company’s results has even surpasses the expectations of analysts.
Fourth-quarter net income rose 16 percent to $5.2 million, or 40 cents per share, compared with $4.5 million, or 35 cents per share, the year before. That included write-downs of $2.5 million, or 12 cents per share, for a canceled U.S. Air Force order. The company has been able to procure healthy contracts from the navy and the air force which has added excellent top line growth for the company. The company has also written down $ 500,000 of bad debts.
The company was also able to hold onto healthy margins. Gross margin stood at 40 percent over the previous quarter of 35 percent. Operating margin stood at 16.4 percent over 14.5 percent over the previous year.
Commenting on the results CEO and President of Astronics said that the fourth quarter was a good one for the company as it was able to record healthy margins and also bag some good orders that will hold the company in good stead over the next few quarters. However, Gundermann noted that the company had its share of disappointments during the quarter as well. He said that the company learned recently that the U.S. Air Force decided to cancel the VDATS procurement, which contributed to the $2.5 million write-down of goodwill and intangible assets in its test system business.
We maintain an accumulate on the stock at current price levels. The company will be able to maintain healthy margins over the next two quarters which will benefit the investors.