Aviation solutions firm Innovative's Q3 revenue up 105.2%, beats estimates

Overview

• Innovative Solutions Q3 revenue rises 105.2% yr/yr, beating analyst expectations

• Net income for Q3 was $2.4 mln, or $0.14 per diluted share

• Company secured $100 mln credit facility to support growth strategy

Outlook

• Company expects full-year revenue and EBITDA growth over 30% vs 2024

• Company anticipates improved gross margins in late fiscal 2026

• Company expects reduced F-16 revenue next two quarters

• New credit facility to support long-term growth strategy

• Completion of Exton facility to enhance manufacturing capacity

Result Drivers

• F-16 PRODUCT LINE - Revenue boost attributed to significant sales from recently acquired F-16 product line, with deliveries pulled forward to build safety stock

• GROSS MARGIN IMPACT - Elevated costs on F-16 line affected gross margins, expected to improve post-transition to Exton facility

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the aerospace & defense peer group is "buy."

• Wall Street's median 12-month price target for Innovative Solutions and Support Inc is $10.95, about 80.2% below its August 13 closing price of $19.73

• The stock recently traded at 30 times the next 12-month earnings vs. a P/E of 11 three months ago

Press Release: ID:nBw2PjDHDa