Why Raytheon Surged, Boeing Slumped, and Lockheed Martin Rocked -- then Rolled -- This Week презентация

Rolled -- This Week

defense contracting reported earnings this week – with very different results for their share prices.

to last year's Q2, but beat analyst estimates by 5%
Earnings from continuing operations grew 4%, to $1.65, or $0.03 ahead of estimates
Best of all, Raytheon generated free cash flow of $288 million during the quarter -- three times as much cash profit as Raytheon generated in Q2 2014

long run (the purchase forced Raytheon to reduce earnings estimates for this year by $0.20) remains an open question.

But Raytheon’s doing a bang-up job of growing the rest of its business, with new orders received exceeding old orders fulfilled (sales) by a factor of 1.3 in the quarter.

then slumped.

to $24.5 billion. That beat analyst estimates by more than 1%
Earnings outperformance was even better, with $1.59 per share surpassing the consensus by 16%
And a surge of cash from plane deliveries has free cash flow now running at $6.8 billion annually – 28% ahead of reported earnings

projected to grow profits at nearly 12% as the company’s 787 Dreamliner program continues to scale up, Boeing shares are starting to look attractive after the week’s slump.

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and a potential divestiture) Monday, slumped, popped again, slumped again, and ended the week not much higher than where they began.

5%
Per-share profits of $2.94 per share likewise beat estimates, growing 6.5% year over year
Cash from operations was up 29%, and even after accelerated capital investment, that left Lockheed Martin with $1.07 billion in free cash flow for the quarter, a 22% year-over-year improvemnet according to data from S&P Capital IQ

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company’s $9 billion acquisition of United Technologies’ (NYSE: UTX) Sikorsky helicopters business. The deal looks good, thanks to a $1.9 billion tax benefit that drops Lockheed’s effective purchase price to $7.1 billion.

But only time will tell if Lockheed can parlay its profit-making proficiency in fighter jets into a turnaround in profitability at Sikorsky.

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