Twin Disc Q2 sales rise on defense demand

Overview

• Power transmission equipment maker's fiscal Q2 sales rose 0.3% yr/yr

• Net income for fiscal Q2 rose significantly due to a tax benefit

• Company reported a gross margin expansion of 70 basis points

Outlook

• Twin Disc reports a six-month backlog of $175.3 mln, indicating strong ongoing demand

• Company expects to convert backlog into shipments as timing normalizes

• Twin Disc remains focused on execution and performance improvements

Result Drivers

• DEFENSE DEMAND - Strong demand in defense-related programs, including Katsa product lines, contributed to order growth

• TARIFF IMPACT - Tariff-related impacts affected shipment timing and product mix, leading to delayed shipments

• BACKLOG SUPPORT - Record backlog of $175.3 mln supported by ongoing demand, providing confidence for future growth

Key Details

Analyst Coverage

• The one available analyst rating on the shares is "buy"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy"

• Wall Street's median 12-month price target for Twin Disc Inc is $24.00, about 26.4% above its February 3 closing price of $18.98

• The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 13 three months ago

Press Release: ID:nGNX5VcL19

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