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Woodward (WWD)
NASDAQ:WWD
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Woodward
(NASDAQ:WWD)
79Outperform
Positive Factors
Financial Performance
Aero incrementals were very strong and China OH sales were 2x the guide.
Market Growth
Woodward's expected 12% commercial aftermarket CAGR significantly outpaces the market forecast and is set to accelerate as new narrow-bodies mature into service cycles.
Negative Factors
China Market
China natural gas business guide is meaningfully lower due to continued elevated levels of dealer inventory and weaker economic growth.
Sales Performance
Direct shipments to BA remain paused post-strike as WWD awaits confirmation on target rates.
Woodward (WWD) vs. S&P 500 (SPY)
Market Cap
$12.48B
Dividend Yield0.49%
Average Volume (3M)556.20K
Price to Earnings (P/E)33.9
Beta (1Y)1.16
Revenue Growth4.96%
EPS Growth8.41%
CountryUS
Employees9,300
SectorIndustrials
Sector Strength91
IndustryAerospace & Defense
Share Statistics
EPS (TTM)1.69
Shares Outstanding59,501,274
10 Day Avg. Volume431,758
30 Day Avg. Volume556,200
Financial Highlights & Ratios
PEG Ratio8.47
Price to Book (P/B)4.94
Price to Sales (P/S)0.00
P/FCF Ratio36.65
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$200.00Price Target Upside-4.67% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Woodward Business Overview & Revenue Model
Company DescriptionWoodward, Inc. (WWD) is a leading designer and manufacturer of control systems and components for the aerospace and industrial markets. The company specializes in providing innovative solutions for energy control and optimization in aircraft, industrial engines, turbines, and other energy-related systems. Woodward's products are designed to enhance the efficiency, reliability, and performance of its customers' applications, serving sectors such as commercial and military aerospace, power generation, and transportation.
How the Company Makes MoneyWoodward generates revenue primarily through the sale of its advanced control systems and components to the aerospace and industrial sectors. The key revenue streams include sales of aerospace components such as fuel pumps, actuators, and cockpit controls, as well as industrial systems like controllers and valves for power generation and distribution. Significant partnerships with major aerospace and industrial companies, as well as long-term contracts for maintenance and support services, also contribute to Woodward's earnings. The company benefits from the ongoing demand for energy-efficient solutions and the need for innovative technologies in both new and existing energy management systems.
Woodward Financial Statement Overview
Summary
Woodward's financial performance is commendable with strong revenue growth and profitability. The company's balance sheet is stable, though increasing debt levels should be monitored. Cash flow generation is solid, supporting ongoing operations and potential investments. While there are areas to watch, such as debt management, Woodward is well-positioned in the Aerospace & Defense industry.Income Statement
Woodward has demonstrated strong revenue growth over recent periods with a significant increase in total revenue from the previous year. The company's gross profit margin is robust, indicating effective cost management, and net profit margin has also improved, reflecting enhanced profitability. EBIT and EBITDA margins are healthy, showcasing the company's operational efficiency.85
Very Positive
Balance Sheet
The balance sheet of Woodward shows a stable financial position with a moderate debt-to-equity ratio, suggesting manageable leverage levels. The company's equity ratio indicates a solid foundation of equity in its asset base. Return on equity is strong, showing effective use of shareholder funds. However, the increase in total debt warrants caution.75
Positive
Cash Flow
Woodward's cash flow statement reveals positive free cash flow growth, indicating efficient cash generation. The operating cash flow to net income ratio supports a healthy cash conversion cycle. However, fluctuations in capital expenditures and financing activities suggest varying cash flow management strategies over time.80
Positive
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 3.36B | 3.32B | 2.91B | 2.38B | 2.25B | 2.50B | Gross Profit |
| 867.47M | 876.48M | 677.58M | 525.30M | 551.06M | 640.24M | EBIT |
| 421.56M | 428.30M | 304.71M | 110.39M | 155.56M | 216.17M | EBITDA |
| 621.23M | 618.10M | 443.35M | 231.02M | 285.09M | 424.72M | Net Income Common Stockholders |
| 381.41M | 372.97M | 232.37M | 171.70M | 208.65M | 240.40M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 144.35M | 282.27M | 137.45M | 107.84M | 448.46M | 153.27M | Total Assets |
| 4.13B | 4.37B | 4.01B | 3.81B | 4.09B | 3.90B | Total Debt |
| 739.12M | 895.14M | 742.21M | 777.42M | 734.85M | 838.48M | Net Debt |
| 594.78M | 612.87M | 604.76M | 669.57M | 286.39M | 685.21M | Total Liabilities |
| 1.94B | 2.19B | 1.94B | 1.91B | 1.88B | 1.91B | Stockholders Equity |
| 2.19B | 2.18B | 2.07B | 1.90B | 2.21B | 1.99B |
| Cash Flow | Free Cash Flow | ||||
| 315.34M | 342.81M | 232.04M | 140.77M | 426.98M | 302.40M | Operating Cash Flow |
| 407.31M | 439.09M | 308.54M | 193.64M | 464.67M | 349.49M | Investing Cash Flow |
| -43.71M | -89.22M | -73.55M | -65.45M | -35.30M | -6.88M | Financing Cash Flow |
| -316.24M | -218.05M | -196.47M | -442.38M | -136.32M | -290.24M |
Woodward Technical Analysis
Positive
209.79
Price Trends
182.97
Positive
183.03
Positive
174.76
Positive
Market Momentum
7.87
Negative
75.55
Negative
95.38
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WWD, the sentiment is Positive. The current price of 209.79 is above the 20-day moving average (MA) of 190.79, above the 50-day MA of 182.97, and above the 200-day MA of 174.76, indicating a bullish trend. The MACD of 7.87 indicates Negative momentum. The RSI at 75.55 is Negative, neither overbought nor oversold. The STOCH value of 95.38 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WWD.
Woodward Risk Analysis
Woodward disclosed 28 risk factors in its most recent earnings report. Woodward reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Woodward Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $15.46B | 36.48 | 17.40% | 0.20% | 9.77% | 15.66% | |
79 Outperform | $12.48B | 33.89 | 16.35% | 0.49% | 4.96% | 8.41% | |
77 Outperform | $13.84B | 17.36 | 11.70% | 0.10% | 0.57% | -5.62% | |
76 Outperform | $10.02B | 34.87 | 28.24% | 0.88% | 9.87% | 14.16% | |
71 Outperform | $11.09B | 47.79 | 9.50% | 0.21% | 13.58% | 25.96% | |
68 Neutral | $10.02B | 142.15 | ― | 16.92% | ― | ||
64 Neutral | $4.43B | 12.01 | 5.16% | 249.23% | 4.03% | -11.73% |
* Industrials Sector Average
Performance Comparison
WWD
Woodward
209.79
29.42
16.31%
CW
Curtiss-Wright
410.11
131.46
47.18%
DRS
Leonardo Drs
41.67
17.39
71.62%
TXT
Textron
76.68
-12.25
-13.77%
BWXT
BWX Technologies
109.69
21.81
24.82%
SARO
StandardAero, Inc.
29.95
-3.02
-9.16%
Woodward Earnings Call Summary
Earnings Call Date:Apr 28, 2025
(Q2-2025)
| % Change Since: 15.62%|
Next Earnings Date:Aug 04, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a strong performance overall, especially in the Aerospace segment, with significant growth in sales and earnings. However, challenges persist in the Industrial segment and the China market, with some expected moderation in future growth. The sentiment is balanced between positive growth and existing challenges.Q2-2025 Updates
Positive Updates
Strong Overall Performance
Woodward's net sales increased by 6% year-over-year with adjusted earnings per share up by 4%. Excluding China on-highway, revenue was up 12% and operating earnings up 22%.
Aerospace Segment Growth
Aerospace segment sales increased by 13%, with defense OEM sales up 52% and commercial aftermarket sales up 23%.
Innovation in Turbine Control Systems
Woodward delivered the first production MicroNet XT Advanced Gas Turbine Control System for the US Navy DDG-51 class destroyer, with a contract covering 30 system deliveries through 2027.
Record Earnings in Aerospace
Earnings in the Aerospace segment reached the highest on record at $125 million with margins expanding 240 basis points over the previous year to 22.2% of segment sales.
Positive Price Realization
Price realization contributed significantly to revenue growth across both the Aerospace and Industrial segments.
Negative Updates
Decline in Industrial Segment Sales
Industrial segment sales decreased by 5%, with transportation down 18% due to declining China on-highway sales.
Challenges with China Market
Demand for heavy-duty trucks in China remains subdued, with a $45 million decrease in China on-highway sales from the prior year.
Lower Free Cash Flow
Free cash flow was $60 million for the first half of 2025, compared to $88 million in the previous year, primarily due to an increase in working capital.
Moderation in Commercial Aftermarket Growth
Commercial aftermarket sales growth is expected to moderate in the second half of the year, with potential impacts from slower commercial services growth.
Company Guidance
During Woodward, Inc.'s second quarter fiscal year 2025 earnings call, the company reported strong performance, with net sales up 6% year-over-year and adjusted earnings per share increasing by 4%. Excluding China on-highway, revenue rose 12% and operating earnings surged by 22%. The aerospace segment experienced a 13% sales increase, driven by a 52% rise in defense OEM sales, while the commercial aftermarket grew by 23%. However, industrial segment sales declined by 5%, largely due to an 18% drop in China on-highway sales. The company reaffirmed the top end of its guidance, now anticipating consolidated sales of $3.375 billion to $3.5 billion and adjusted EPS between $5.95 and $6.25. Despite potential tariff impacts and softer commercial services growth rates expected in the second half, Woodward remains optimistic about its long-term prospects and continues to prioritize investing in organic growth, returning cash to shareholders, and strategic M&A.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.