Heico Corp (NYSE: HEI) in the second quarter of FY 17 has reported the adjusted earnings per share of $0.53, beating the analysts’ estimates for the adjusted earnings per share of $0.50. The company had reported the adjusted revenue growth of 5 percent to $368.7 million in the second quarter of FY 17, beating the analysts’ estimates for revenue of $369.5 million. HEI has reported in the Q2 FY 17, the 18 percent growth in the net income to a record $45.7 million, up from $38.7 million, in the second quarter of fiscal 2016
Moreover, Heico’s net debt to shareholders’ equity ratio was 37.3% as of April 30, 2017, with net debt (total debt less cash and cash equivalents) of $424.1 million principally incurred to fund acquisitions in fiscal 2017 and 2016. HEI has increased the aggregate principal amount of the revolving credit facility by $200 million to $1.0 billion through increased commitments from existing lenders in April 2017. The company have no significant debt maturities until fiscal 2019 and has planned to utilize the financial flexibility to aggressively pursue high-quality acquisition opportunities to accelerate growth and maximize shareholder returns.
For the consolidated FY 17, Heico expects the growth in net sales to 8% – 10% and in net income to 12% – 14%, up from prior growth estimates in net sales of 6% – 8% and in net income of 9% – 11%. The company now expects the consolidated operating margin to approximate 20%, depreciation, and amortization expense to approximate $65 million, capital expenditures to approximate $35 million and cash flow from operations to approximate $270 million, up from the previous estimate of $260 million in cash flow from operations.
Additionally, for FY 17 Heico expects mid to high-single digit growth in the Flight Support Group’s net sales over fiscal 2016 levels and the full year Flight Support Group operating margin to approximate 19.0% – 19.5%. The company expects mid to high-single digit growth in the Electronic Technologies Group’s net sales over fiscal 2016 levels, and anticipates the full year Electronic Technologies Group’s operating margin to approximate 25%.
Heico stock has risen 44.54% in the last one year (source: Google Finance). According to tipranks.com, Heico has an average price target of $76.50, which is a further upside of 2.31%.