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What's in Store for Spirit AeroSystems' (SPR) Q2 Earnings?

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Spirit AeroSystems Holdings, Inc. SPR is set to report second-quarter 2021 results on Aug 4, before market open. In the last reported quarter, the company delivered a negative earnings surprise of 31.18%.

In the trailing four quarters, the company came up with a negative earnings surprise of 49.88%, on average.

Let's take a closer look at the factors influencing Spirit AeroSystems’ upcoming results.

Factors to Consider

During the second quarter, commercial air travel continued to recover in the United States and China, primarily flown by narrow-body aircraft. Spirit AeroSystems seems to be well positioned to benefit from this trend, given that 85% of its backlog constitutes narrow-body aircraft.

In relation to the positive trend, Spirit AeroSystems in the first-quarter earnings call anticipated delivering higher shipsets during the remaining of 2021, including the second quarter. So, we expect the company’s shipset deliveries to have finally improved in the second quarter, as both its major customers, Boeing BA and Airbus EADSY, have witnessed a solid ramp up in the delivery of their 737 MAX and A350 wide-body jets, respectively. As
Spirit AeroSystems generates a huge chunk of its revenues from supplies made to Boeing and Airbus, improved performance by these jet makers is likely to have favorably impacted its quarterly revenues.

In line with such events, the Zacks Consensus Estimate for second-quarter revenues is pegged at $911 million, indicating a 41.4% surge from the year-ago quarter’s reported figure.

As commercial air travel commences to revive from the impacts of the COVID-19 pandemic, the company is expected to have witnessed increased narrow-body rates during the second quarter. During the first quarter itself, the company experienced reduced restructuring expenses, excess capacity costs and lower abnormal COVID-19 charges that contributed to the overall gross profit improvement. We expect this trend to have continued and thereby favorably impacted the company’s bottom line in the second quarter.

The Zacks Consensus Estimate for Spirit AeroSystems’ second-quarter loss stands at 66 cents per share, which implying a significant improvement from a loss of $2.28 incurred in the prior-year quarter.

Spirit Aerosystems Holdings, Inc. Price and EPS Surprise

Spirit Aerosystems Holdings, Inc. Price and EPS Surprise
Spirit Aerosystems Holdings, Inc. Price and EPS Surprise

Spirit Aerosystems Holdings, Inc. price-eps-surprise | Spirit Aerosystems Holdings, Inc. Quote

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Spirit AeroSystems this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Spirit AeroSystems has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

A Stock to Consider

Here is a stock you may want to consider as it has the right combination of elements to post an earnings beat in its upcoming release:

L3Harris Technologies LHX has an Earnings ESP of +0.43% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

The Boeing Company (BA) : Free Stock Analysis Report

Spirit Aerosystems Holdings, Inc. (SPR) : Free Stock Analysis Report

Airbus Group (EADSY) : Free Stock Analysis Report

L3Harris Technologies Inc (LHX) : Free Stock Analysis Report

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Zacks Investment Research

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