Upcoming AWS Coverage on HEICO Post-Earnings Results

LONDON, UK / ACCESSWIRE / February 21, 2017 / Active Wall St. blog coverage looks at the headline from LMI Aerospace Inc. (NASDAQ: LMIA) ("LMI") as the Company announced on February 16, 2017, that it has entered into a merger agreement to be acquired by Sonaca S.A., a limited liability Company dealing in global aerostructures and headquartered at Gosselies, Belgium. Under terms of the agreement, LMI's shareholders will receive $14 per share of the common stock, in an all-cash transaction. Register with us now for your free membership and blog access at:

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One of LMI Aerospace's competitors within the Aerospace/Defense Products & Services space, HEICO Corp. (NYSE: HEI), announced on February 14, 2017, that it will release its financial results for the first quarter ended January 31, 2017, on February 28, 2017, after the NYSE closing. AWS will be initiating a research report on HEICO in the coming days.

Today, AWS is promoting its blog coverage on LMIA; touching on HEI. Get all of our free blog coverage and more by clicking on the links below:

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Breaking down the Transaction

Post the closure of the transaction, LMI will operate as LMI Aerospace, under the Sonaca Group. The Company will resume its investments in its current portfolio and elevate its US and worldwide business infrastructure and the capabilities of the teams. Sonaca and LMI are both aerospace parts manufacturers. The client base of these companies differs where LMI client base includes the likes of Boeing (NYSE: BA), Spirit Aerosystems (NYSE: SPR), and Gulfstream. On the other hand, Sonaca's primary clients include Airbus and Embraer (NYSE: ERJ).

Growth Opportunities for the Companies

This proposed transaction is viewed as an expansion opportunity for Sonaca. LMI views Sonaca's business highly complementary to its prospects across both revenue generation and capabilities. Sonaca reported FY15 full-year revenues of approximately $404 million. The Company specializes in the design and production of advanced structures including wing movables and complex fuselages. Sonaca currently operates across China, Romania, Canada, and Brazil with an estimated workforce of 2,500 employees.

Sonaca expects to develop its market share in the US and other countries, where LMI operates, through the execution of this transaction. The businesses of Sonaca and LMI, although complementary, have minimal overlap in terms of current customers. Hence, this agreement is viewed as a definitive growth strategy. LMI views definitive growth opportunities and greater cash inflow while banking on a larger global market share and support by a parent company with deeper capital resources and market presence.

LMI Aerospace Prospects

LMI has ended up getting several major contracts from Boeing, where the primary one is the next version of Boeing 737 airliner. The 737 currently accounts for about 30% of LMI revenue generation. LMI operates within 21 locations across the US, Mexico, UK, and Sri Lanka where it offers structural assemblies, kits, and components, along with engineering services to the commercial, business, regional and other aerospace markets. LMI delivered its first aileron and flap assemblies to Honda Aircraft Company on October 13, 2016, for the HA-420 HondaJet. LMI was awarded this contract post the aerostructures work packages delivery of aileron and flap assemblies.

Expectations for Full-Year FY16 Results

LMI reported its updated financial expectation for FY16 ending December 31, 2016. The Company expects net sales in the range of $345.7 million-$346.7 million for full-year FY16 against the previous guidance of $345.0 million-$355.0 million. The operating profit is estimated at $13.5-$14.5 million for full-year FY16, while the free cash flow is estimated at $3.0 million-$4.0 million for the full-year FY16. LMI expects to release Q4 FY16 and full-year FY16 results in March 2017.

Stock Performance

On Friday, February 17, 2017, the stock closed the trading session at $13.66, soaring 48.64% from its previous closing price of $9.19. A total volume of 2.31 million shares have exchanged hands, which was higher than the 3-month average volume of 24.89 thousand shares. LMI Aerospace's stock price rallied 51.61% in the last month, 72.91% in the past three months, and 88.15% in the previous six months. Furthermore, since the start of the year, shares of the Company have surged 58.47%. The stock currently has a market cap of $125.26 million.

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SOURCE: Active Wall Street