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Orbital ATK (OA) Misses Q4 Earnings, Tops Sales Estimates

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Orbital ATK, Inc. posted fourth-quarter 2017 adjusted earnings of $1.77 per share, missing the Zacks Consensus Estimate of $1.84 by 3.8%. Earnings improved 40.5% year over year from $1.26 per share.

Total Revenues

Orbital ATK's total revenues was $1,348 million, beating the Zacks Consensus Estimate of $1,276 million by 5.64%.

Revenues were up 6% than the year-ago quarter’s figure of $1,272 million, courtesy of increased sales volume in Flight Systems Group and Defense Systems Group segment.

 

Orbital ATK, Inc. Price, Consensus and EPS Surprise

Orbital ATK, Inc. Price, Consensus and EPS Surprise | Orbital ATK, Inc. Quote

 

Segmental Update

Flight Systems Group: Revenues in the segment rose 13.3% year over year to $459 million, on the back of higher activity in all product divisions and new business wins.

Defense Systems Group: Revenues in the segment totaled $578 million, up 19.9% year over year from higher activity on all product divisions.

Space Systems Group: Revenues in the segment were $367 million, down 13.6% year over year due to lower activity on Satellite Systems Division contracts.

Highlights of the Release

Research and development expenses in the fourth quarter totaled $144 million. Continuous investment in research enabled the company upgrade its existing products and develop new ones.

The company discontinued its share repurchase program due to the ongoing acquisition with Northrop Grumman (NOC - Free Report) .

In the fourth quarter, Orbital ATK's firm contract backlog was approximately $10.2 billion, as it received new firm and option orders. Total backlog was approximately $16 billion, up 12%.
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Total adjusted operating income improved 11.7% to $145 million from $129.8 million in the year-ago quarter.

Financial Highlights

Net cash from operating activities was $362.9 million and free cash flow was $256.3 million in the fourth quarter.

Capital expenditure was $106.6 million in fourth quarter. The company invested $244.6 million in 2017.

Zacks Rank

Orbital ATK carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peers Releases

Huntington Ingalls Industries’ (HII - Free Report) fourth-quarter 2017 adjusted earnings per share was $3.11, which surpassed the Zacks Consensus Estimate of $2.92 by 6.5%.
    
Raytheon Company reported fourth-quarter 2017 earnings from continuing operations of $2.03 per share, beating the Zacks Consensus Estimate of $2.02 by 0.5%.

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