50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

Curtiss-Wright stock poised for 21% upside as nuclear and defense opportunities grow

EditorEmilio Ghigini
Published 12/05/2024, 06:34 PM
CW
-

On Thursday, Deutsche Bank (ETR:DBKGn) initiated coverage on Curtiss-Wright (NYSE:NYSE:CW) stock with a Buy rating, accompanied by a price target of $452.00. This target suggests a potential 21% upside from the company's current market valuation. The stock has already demonstrated remarkable momentum, with a 70.67% year-to-date return and 76.08% gain over the past year, according to InvestingPro data.

The firm's coverage begins with a positive outlook on the diversified manufacturer, emphasizing the multiple avenues through which Curtiss-Wright could potentially yield excess returns for investors.

The analyst from Deutsche Bank pointed out that returns could come from a variety of sources, including the company's base case earnings per share (EPS) growth, capital return options, a rebound in demand within the commercial nuclear industry, and opportunities in defense electronics.

InvestingPro analysis reveals the company maintains a GREAT financial health score, with strong profitability metrics including a 37.05% gross margin and 17% return on equity.

The analyst elaborated on the rationale behind the optimistic stance, stating that Curtiss-Wright's diversified exposure and the array of opportunities to achieve higher returns create a favorable risk/reward scenario. This solid foundation is seen as a driving force for the company to continue delivering excess returns moving forward.

Curtiss-Wright's stock performance is tied to several factors, as outlined by Deutsche Bank. The company's long-term EPS growth, referred to as the "LDD base case," is one such factor. Additionally, the company has approximately $2 billion in near-term (NTM) capital return optionality, which could be a significant contributor to shareholder value.

The analyst also highlighted the company's strategic position to benefit from the commercial nuclear industry's expected demand resurgence. Moreover, Curtiss-Wright's potential to gain a larger share in the defense electronics market was identified as another key driver that could lead to stock outperformance.

Curtiss-Wright, with its diversified business model and various growth levers, is thus positioned by Deutsche Bank as a stock with a robust foundation for future gains, underpinning the firm's Buy rating and bullish price target.

Notable strengths identified by InvestingPro include a 51-year track record of maintaining dividend payments and solid revenue growth of 9.42% over the last twelve months.

While trading at premium multiples with a P/E of 35.52, investors can access comprehensive valuation analysis and 16 additional ProTips through InvestingPro's detailed research reports, available for over 1,400 US stocks.

In other recent news, Curtiss-Wright Corporation has announced a series of notable developments. The company reported a 10% year-over-year sales increase to nearly $800 million in the third quarter of 2024, boosted by significant growth in the Defense Electronics and Naval & Power segments.

Additionally, the company has raised its full-year 2024 guidance, now anticipating sales growth of 7% to 9% and diluted EPS growth of 12% to 15%.

Curtiss-Wright also unveiled two new stock repurchase plans set to commence in 2025, with a total budget of $160 million. The company's decision to return value to shareholders through share buybacks and a recently announced quarterly dividend of $0.21 per share highlights its financial health and commitment to its investors.

In terms of analyst ratings, Stifel raised its price target for Curtiss-Wright from $361 to $370, maintaining a Buy rating, while Truist Securities boosted its price target to $333.00, continuing its Hold rating. These adjustments come in response to the company's robust market position and strong financial performance.

Lastly, Curtiss-Wright's outlook for 2025 remains positive, with expectations of mid-single-digit growth and significant increases in commercial nuclear revenue. The company's strategic investments and partnerships, particularly in the commercial nuclear and defense sectors, are driving this growth.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.