Zeev's Turnips Patch-No Politics (ZEEV)

[MiamiGent]

"Stock Market Picks For Active Traders And Investors"


Long Play: SPR- Play is active

On Wednesday, I alerted Spirit Aero Systems (SPR) which closed at 55.80, having dropped from 60.04 on an underappreciated Fourth Quarter Earnings Report. Thursday afforded the opportunity to get in from 54.37 to 54.71
Friday began the price recovery, steadily reaching a high of 56.63 as shorts realized their party would be brief.
Friday's close of 56.05 leaves plenty of upside with an average analyst (18) Price Target of 62.68
Short term traders might set their sights on 59-60. Investors can settle in for the long run with this highly rated stock.
Some additional facts to consider:
. Spirit is Boeing's largest supplier. Boeing is "sold out" for 2017 and mostly sold out for 2018 and 2019. the 2020's will witness a wave of wide body retirements.
. With a present Trailing P/E of 15.15, SPR is undervalued compared to its peer group with an average P/E about a third higher
. SPR has authorized $600M for continued share repurchase and "inorganic" expenditures (acquisitions) in Defense companies.
. Initiating a Dividend signals the company's confident outlook.
Spirit is a solid company with a low risk profile. It's on sale in my opinion and am looking for the recovery to continue next week, barring a market turn down which very green futures are not signaling at this writing.
Please read Wednesday's SPR Summary for further color.
Good trading all!
MG

Stock Chart for SPR:
http://stockcharts.com/h-sc/ui?s=SPR



February 1 at 9:33pm
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"Stock Market Picks For Active Traders Of Fully Reporting Stocks"

Long Play: SPR

SPR Summary: Aircraft parts maker Spirit Aero Systems Holdings Inc. (SPR) reported Earnings this morning that met company upper end Guidance and I/B/E/S estimate. Full year Adjusted EPS were up 16% year over year.
Actual Earnings were less, attributable to a Hurricane Matthew that affected the company's North Carolina facility that the company expects their insurance to cover and to a voluntary retirement offering which will result in cost savings.
The share price closed down at $55.80, -7.08%, likely due to usual Earnings profit taking by traders and the trade just reading the headlines and not getting into the weeds to see the fourth quarter EPS gap will be made up by insurance reimbursement and cost savings from lower employee count.
It achieved a higher ratings from Moody and S&P which enabled the company to refinance its debt favorably.
It did not use its $650M Revolving Line of Credit.
It initiated a Dividend this quarter.
It has a $47B dollar backlog- almost seven years of work!
Spirit was part of Boeing not long ago. It does a very significant business with Boeing and now independent, sees wide opportunity to increase its Defense work. This looks very promising with a Trump administration
It offered 2017 Guidance that increases Revenues, Earnings and Cash.
SPR is very highly rated by the leading analysts yet has a quite reasonable P/E (Trailing Twelve Months) of 15.76
Even if we look to Capital IQ higher estimates, rev's missed by 1% and EPS by 3%. Today's decline of 7% looks overdone.
I am looking for a near term bounce and appears also to be a decent entry for long term investors.
MG