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Spirit AeroSystems Holdings (NYSE:SPR) on Friday was downgraded to a Neutral rating from Outperform by analysts at Baird. They said the maker of aircraft parts faces inflationary pressures and limited ability to raise prices because of its long-term contracts with customers such as Boeing (BA) and Airbus (OTCPK:EADSF).
Spirit (SPR) “should be able to show sequential operating profit improvements as volumes ramp but previous historical margin achievements are much more challenged in an inflationary environment,” Peter J. Arment, analyst at Baird, said in a Nov. 4 report.
Spirit (SPR) on Thursday reported an adjusted loss per share of -$0.15 for Q3, beating estimates by $0.24. A 31% gain in revenue from a earlier to $1.28 billion missed estimates by $40 million.
Baird cut its price target for Spirit (SPR) $29 from $43, based on an enterprise value-to-EBITDA multiple of nine times, compared with a historical range of eight to 13 times.
Spirit’s (SPR) stock this year has declined 48%, compared with a 16% slide for the Standard & Poor’s 400 mid-cap index (SP400).
| Baird’s estimates for Spirit AeroSystems (SPR), Nov. 4 | |||
| Earnings/Loss Per Share | |||
| New | Old | ||
| 2022E | -$1.46 | -$1.30 | |
| 2023E | $0.65 | $1.20 | |
