What Happened?

Shares of aerospace and defense company Woodward (NASDAQ:WWD) jumped 12.4% in the morning session after the company reported third-quarter results that blew past analysts' revenue, EBITDA, and earnings expectations. Aerospace sales were a key contributor to the strong performance, up 22% year on year. 

Looking ahead, management provided full-year sales guidance in line with expectations; the company raised full-year EPS guidance, which is more promising when combined with the solid outlook for the Aerospace segment, particularly in defense and commercial aftermarket activity. However, challenges in the Industrial sector, including deteriorating conditions in China, highlight the uneven recovery across segments​. Zooming out, we think this was still a decent quarter.

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What The Market Is Telling Us

Woodward’s shares are not very volatile and have only had 2 moves greater than 5% over the last year. Moves this big are rare for Woodward and indicate this news significantly impacted the market’s perception of the business.

Woodward is up 41.5% since the beginning of the year, and at $190.85 per share, has set a new 52-week high. Investors who bought $1,000 worth of Woodward’s shares 5 years ago would now be looking at an investment worth $1,613.

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