Matthew Akers, an analyst from Wells Fargo, maintained the Hold rating on Woodward (WWD – Research Report). The associated price target is $151.00.
Matthew Akers has given his Hold rating due to a combination of factors that suggest a balanced outlook for Woodward’s stock. The company has raised its full-year 2024 guidance, reflecting increased visibility into demand for China on-highway at Industrial. Despite the positive adjustment in guidance, with expected top line, EPS, and free cash flow increases, the report anticipates that the Industrial margin’s strong performance seen in Q1—attributed to favorable mix and efficiency gains—is unlikely to be replicated in the subsequent quarters. This tempered expectation contributes to the decision to maintain an Equal Weight (Hold) rating.
Further influencing Akers’ rating is the mixed performance across Woodward’s segments. While the Commercial OEM and aftermarket sectors showed year-over-year growth in Q1, the expected sales contribution from China on-highway engines is projected to decrease in the second half of the year. Moreover, while the updated FY24 EPS guidance is improved, the FY25 EPS estimate has been lowered, reflecting a conservative stance on future contributions from China on-highway. Additionally, the price target increase to $151 aligns with Woodward’s trading multiples, suggesting that the stock is fairly valued at current levels, thus supporting the Hold rating.
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Based on the recent corporate insider activity of 27 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of WWD in relation to earlier this year.
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Woodward (WWD) Company Description:
Woodward, Inc. engages in the provision of control system solutions and components for the aerospace and industrial markets. It operates through the Aerospace and Industrial segment. The Aerospace segment designs, manufactures, and services systems and products for the management of fuel, air, combustion and motion control. The Industrial segment includes the design and services systems and products for the management of fuel, air, fluids, gases, electricity, motion, and combustion. The company was founded by Amos W. Woodward in 1870 and is headquartered in Fort Collins, CO.
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