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Triumph Group (TGI)
NYSE:TGI
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Triumph Group
(NYSE:TGI)
54Neutral
Positive Factors
Acquisition
TGI shareholders will receive $26 per share in cash, representing a 39% premium to the closing price before the deal was announced.
Financial Performance
Overall performance was strong as EBITDA topped expectations and cash flow came in better than what management had previously guided.
Negative Factors
Stock Performance
The stock is down ~18% YTD in 2024, significantly underperforming the overall market, mostly impacted by BA quality escapes tied to the January 5 plugged door incident and the ongoing strike action.
Triumph Group (TGI) vs. S&P 500 (SPY)
Market Cap
$1.97B
Dividend YieldN/A
Average Volume (3M)2.76M
Price to Earnings (P/E)281.4
Beta (1Y)1.68
Revenue Growth-8.59%
EPS GrowthN/A
CountryUS
Employees4,530
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)0.09
Shares Outstanding77,407,906
10 Day Avg. Volume1,577,784
30 Day Avg. Volume2,760,808
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.23
Price to Cash Flow (P/CF)14.80
P/FCF Ratio14.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$26.00Price Target Upside2.20% Upside
Rating ConsensusHold
Number of Analyst Covering5
Triumph Group Business Overview & Revenue Model
Company DescriptionTriumph Group, Inc. engages in the designing, engineering, manufacturing, repairing and overhauling of aerospace and defense systems, components and structures. It operates through the following three segments: Triumph Integrated Systems, Triumph Aerospace Structures and Triumph Product Support. The Triumph Integrated Systems segment engages in designing, development and supporting proprietary components, subsystems and systems, as well as production of complex assemblies using external designs. The Triumph Aerospace Structures segment engages in supplying of commercial, business, regional and military manufacturers with large metallic and composite structures and produce close-tolerance parts. The Triumph Product Support segment provides full life cycle solutions for commercial, regional and military aircraft. The company was founded by Richard C. Ill in 1993 and is headquartered in Berwyn, PA.
How the Company Makes MoneyTriumph Group makes money through a diversified revenue model that includes the sale of aerostructures and aircraft components, systems integration services, and aftermarket support. Key revenue streams are generated from contracts with major aerospace manufacturers, defense organizations, and airlines. The company also benefits from long-term maintenance, repair, and overhaul (MRO) agreements that provide recurring revenue. Strategic partnerships and collaborations with major aerospace and defense firms further contribute to its earnings, allowing Triumph Group to expand its market reach and enhance its technological capabilities.
Triumph Group Financial Statement Overview
Summary
Triumph Group has demonstrated improvements in profitability and leverage, with a strong turnaround in equity. However, declining revenue and continued negative cash flows highlight ongoing challenges in sales growth and cash generation. The company shows potential for recovery, but risks remain due to its debt levels and cash flow constraints.Income Statement
The income statement shows positive growth in net income and profitability. The gross profit margin improved in the TTM, indicating better efficiency in cost management. However, the revenue has declined over recent years, suggesting challenges in maintaining sales growth. The EBIT and EBITDA margins have shown improvement, reflecting better operational performance.70
Positive
Balance Sheet
The balance sheet reveals a substantial improvement in stockholders' equity, moving from negative to positive, which is a positive turnaround. The debt-to-equity ratio has improved significantly, indicating reduced leverage. However, the company still has considerable debt, which poses a risk to financial stability. The equity ratio is healthy, suggesting a stable asset base.45
Neutral
Cash Flow
Cash flow statements indicate a positive shift in free cash flow and operating cash flow, although both remain negative. This improvement points to better cash management, but the company still faces challenges in generating positive cash flows. The operating cash flow to net income ratio is negative, indicating reliance on non-operational activities for cash generation.55
Neutral
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.24B | 1.19B | 1.38B | 1.46B | 1.87B | 2.90B | Gross Profit |
| 371.63M | 322.84M | 387.53M | 386.88M | 393.45M | 592.72M | EBIT |
| 135.63M | 86.45M | 161.19M | 140.55M | 133.68M | 237.61M | EBITDA |
| 152.87M | 125.30M | 149.26M | 147.66M | -183.30M | 361.41M | Net Income Common Stockholders |
| 560.13M | 512.38M | 89.59M | -42.76M | -450.91M | -29.43M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 133.49M | 392.51M | 227.40M | 240.88M | 589.88M | 485.46M | Total Assets |
| 1.51B | 1.69B | 1.71B | 1.76B | 2.45B | 2.98B | Total Debt |
| 8.55M | 1.09B | 1.69B | 1.59B | 1.96B | 1.88B | Net Debt |
| -124.94M | 702.16M | 1.46B | 1.35B | 1.37B | 1.39B | Total Liabilities |
| 313.48M | 1.79B | 2.51B | 2.55B | 3.27B | 3.76B | Stockholders Equity |
| 1.20B | -104.41M | -797.40M | -787.42M | -818.85M | -781.26M |
| Cash Flow | Free Cash Flow | ||||
| -55.37M | -12.38M | -72.93M | -156.68M | -198.30M | 56.83M | Operating Cash Flow |
| -34.41M | 9.44M | -52.25M | -137.02M | -173.12M | 96.67M | Investing Cash Flow |
| 696.98M | 689.92M | -27.17M | 181.21M | -9.29M | 7.39M | Financing Cash Flow |
| -688.72M | -534.34M | 65.79M | -392.66M | 277.25M | 293.69M |
Triumph Group Technical Analysis
Positive
25.44
Price Trends
22.55
Positive
19.96
Positive
17.19
Positive
Market Momentum
0.67
Positive
78.60
Negative
76.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TGI, the sentiment is Positive. The current price of 25.44 is above the 20-day moving average (MA) of 25.30, above the 50-day MA of 22.55, and above the 200-day MA of 17.19, indicating a bullish trend. The MACD of 0.67 indicates Positive momentum. The RSI at 78.60 is Negative, neither overbought nor oversold. The STOCH value of 76.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TGI.
Triumph Group Risk Analysis
Triumph Group disclosed 36 risk factors in its most recent earnings report. Triumph Group reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Triumph Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $109.73B | 20.90 | 81.04% | 2.73% | 5.14% | -19.14% | |
73 Outperform | $7.70B | 14.05 | 12.56% | 2.70% | 0.71% | -18.39% | |
68 Neutral | $75.52B | 47.51 | -29.16% | ― | 16.89% | 20.33% | |
65 Neutral | $4.58B | 35.49 | 8.14% | 1.10% | 6.31% | 28.25% | |
61 Neutral | $8.21B | 13.22 | 1.07% | 3.07% | 3.78% | -16.88% | |
54 Neutral | $1.97B | 281.42 | 46.74% | ― | -8.59% | ― | |
35 Underperform | $3.92B | ― | 81.63% | ― | 4.44% | -202.63% |
* Industrials Sector Average
Performance Comparison
TGI
Triumph Group
25.44
12.32
93.90%
HXL
Hexcel
56.48
-14.86
-20.83%
HII
Huntington Ingalls
196.16
-87.44
-30.83%
LMT
Lockheed Martin
466.17
44.04
10.43%
SPR
Spirit AeroSystems
33.44
0.91
2.80%
TDG
Transdigm Group
1,346.50
227.92
20.38%
Triumph Group Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: 1.03% | Next Earnings Date: May 14, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant achievements in cash performance, aftermarket growth, and the restoration of Interiors business profitability. The company raised its fiscal 2025 guidance, indicating strong confidence in future performance. Despite some challenges, such as temporary declines in the V-22 program and Boeing backlog pushouts, the positive aspects significantly outweigh the negatives.Highlights
Strong Cash Performance and Aftermarket Growth
Exceeded cash guidance by $35 million and accelerated aftermarket growth with a 13% year-over-year increase. Aftermarket contributed over 60% of profit, offsetting some Commercial OEM softness.
Restoration of Interiors Business Profitability
Interiors business returned to profitability through a settlement with Boeing and cost reductions. Expected to achieve higher historical levels of profitability as Commercial OEM volumes return.
Increased Fiscal 2025 Guidance
Raised fiscal '25 guidance for profitability and cash flow. Expecting EBITDAP of $190 million to $195 million and free cash flow of $20 million to $30 million.
Successful Military OEM and Aftermarket Performance
Military OEM revenues increased, with a backlog growth of 4%. Aftermarket backlog increased by 12%, driven by strong spares and repairs orders.
Operational Excellence Across All Operating Companies
Achieved tenth consecutive quarter of organic growth and improved operational excellence.
Lowlights
Temporary Decline in V-22 Actuators Overhaul
Short-term declines in V-22 actuators overhaul due to temporary flight restrictions on the Osprey fleet.
Pushouts in Boeing Program Backlogs
Backlog on Boeing programs declined $60 million due to selective pushouts of deliveries beyond 24 months.
Supply Chain Challenges and OEM Revenue Headwinds
Faced supply chain challenges and OEM revenue headwinds, although these are expected to improve in the second half.
Company Guidance
During the Triumph Group's second quarter fiscal 2025 earnings call, several key metrics were highlighted, reflecting the company's strong performance and optimistic outlook. The company exceeded its cash guidance by $35 million, setting a positive trajectory for achieving its full-year free cash flow target. Notably, aftermarket revenues surged 13% year-over-year, contributing over 60% of the company's profits, driven by robust sales in both commercial and military markets. The aftermarket segment achieved gross margins of 57%. Triumph's total aftermarket backlog increased by 12% to approximately $100 million. The company also reported a 30% growth in aftermarket revenue, with total consolidated revenue reaching $287 million, and an adjusted operating income increase of 44% to $36 million. Adjusted EBITDAP was $43 million, reflecting a 26% rise, and an adjusted EBITDAP margin expanded by about 300 basis points to 15%. Triumph's fiscal 2025 guidance was raised, with expected EBITDAP now between $190 million and $195 million, and free cash flow projections increased to $20 million to $30 million.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.