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Spirit AeroSystems Holdings Inc Class A SPR

Morningstar Rating
$35.65 −0.23 (0.64%)
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Company Report

Boeing: Spirit Aero Systems Deal Makes Good Sense; Fair Value Estimates Unchanged

Boeing will take over Spirit Aero Systems later in 2024, exchanging between .18 and .25 shares of its stock per outstanding share of Spirit Aero, depending on the market price of Boeing shares in the weeks preceding the deal's closing. Their agreement values Spirit Aero at $37.25 per share, a $6.25 premium to our fair value estimate. We see the price as justifiable on two grounds: 1) as an all-stock deal, Spirit shareholders may warrant some compensation for interim uncertainty about the value of the currency they are accepting; 2) but more importantly, Spirit will be worth more as part of Boeing than as a standalone enterprise.

Price vs Fair Value

SPR is trading at a 891% premium.
Price
$35.65
Fair Value
$52.00
Uncertainty
Very High
1-Star Price
$75.26
5-Star Price
$53.10
Economic Moat
Lgdcr
Capital Allocation
Gpynspjw

Bulls Say, Bears Say

Bulls

Commercial aerospace manufacturing has a highly visible revenue runway from increasing flights per capita as middle-class demand in emerging markets grows.

Bears

Customer concentration with Boeing leaves Spirit vulnerable to unsystematic risk associated with production difficulties.

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News

Trading Information

Previous Close Price
$35.88
Day Range
$35.5436.20
52-Week Range
$14.6536.34
Bid/Ask
$35.60 / $35.65
Market Cap
$4.16 Bil
Volume/Avg
1,511 / 3.4 Mil

Key Statistics

Price/Earnings (Normalized)
509.29
Price/Sales
0.62
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield

Company Profile

Spirit AeroSystems manufactures aerostructures, particularly fuselages, cockpits, wing sections, engine pylons, and nacelles for commercial and military aircraft. The company was spun out of Boeing in 2005, and the firm is the largest independent supplier of aerostructures for commercial aircraft. Boeing and Airbus are the firm's primary customers—Boeing represented roughly 60% and Airbus roughly 20% of revenue in recent years. The company is highly exposed to Boeing’s beleaguered 737 program, which accounts for nearly half the company's revenue.
Sector
Industrials
Industry
Aerospace & Defense
Stock Style Box
Small Growth
Total Number of Employees
20,655

Competitors

Valuation

Metric
SPR
AIR
BA
Price/Earnings (Normalized)
509.2922.25
Price/Book Value
5.67
Price/Sales
0.621.571.47
Price/Cash Flow
18.3860.37
Price/Earnings
SPR
AIR
BA

Financial Strength

Metric
SPR
AIR
BA
Quick Ratio
0.740.480.22
Current Ratio
1.521.171.14
Interest Coverage
−1.846.300.21
Quick Ratio
SPR
AIR
BA

Profitability

Metric
SPR
AIR
BA
Return on Assets (Normalized)
−13.90%3.14%−1.22%
Return on Equity (Normalized)
23.27%
Return on Invested Capital (Normalized)
−20.39%13.81%0.74%
Return on Assets
SPR
AIR
BA
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