Curtiss-Wright Surprises With Strong Q4, Stock Soars

Curtiss-Wright Corporation (NYSE: CW) has delivered a strong fourth quarter, surpassing market expectations and driving its stock price to new highs. The company's robust performance was fueled by double-digit growth in sales, operating income, and diluted EPS, as well as record free cash flow generation. In this article, we will explore the key factors contributing to Curtiss-Wright's impressive Q4 results and discuss the implications for its future growth prospects.



Strong Sales Growth and Record New Orders

Curtiss-Wright reported a 5% increase in sales compared to the prior year period, driven by solid growth in both its A&D and Commercial markets. The company's A&D markets experienced strong growth, particularly in the defense markets, where increased submarine revenues and higher OEM sales in the commercial aerospace market contributed to the overall sales growth. In the Commercial markets, higher sales of commercial nuclear products partially offset lower industrial valve sales in the process market and lower sales in the general industrial market.



Record New Orders and Book-to-Bill Ratio

Curtiss-Wright received new orders of $939 million, up 37% from the prior year, generating a book-to-bill ratio of 1.1x. This robust order activity reflects strong demand in the A&D markets and demonstrates the company's ability to secure new business. The company's strong backlog at the start of the year, combined with the alignment of its technologies to favorable secular growth trends in its end markets, reinforces its confidence in delivering another strong performance in 2025.

Strong Free Cash Flow Generation

Curtiss-Wright generated $278 million in free cash flow (FCF) in the fourth quarter, representing a 223% Adjusted FCF conversion. This strong FCF generation is a testament to the company's efficient cash flow management and its ability to invest in growth opportunities while maintaining profitability.



Acquisition Strategy and Future Growth Prospects

Curtiss-Wright's recent acquisition of Ultra Energy is expected to contribute to its growth prospects in 2025 and beyond. The acquisition aligns with the company's Pivot to Growth strategy, which focuses on investing in innovative technologies, capacity expansion, talent, and systems to support future growth. The integration of Ultra Energy's capabilities and technologies is anticipated to drive organic growth in Curtiss-Wright's A&D and Commercial Nuclear markets, contributing to the company's total sales growth of 7% to 8% in 2025.



In conclusion, Curtiss-Wright's strong Q4 performance was driven by sales growth, record new orders, strong FCF generation, and a solid operating income. The company's alignment with favorable secular growth trends, commitment to innovation, strong backlog, and strategic acquisition strategy position it well for long-term growth. As the company continues to execute on its Pivot to Growth strategy, investors can expect Curtiss-Wright to maintain its momentum and deliver strong financial results in the coming years.