MTU Aero Engines (MTX) AI Stock Analysis

• Market Cap: €20.69B
• Dividend Yield: 0.58%
• Average Volume (3M): 116.61K
• Price to Earnings (P/E): 24.1
• Beta (1Y): 0.91
• Revenue Growth: 45.24%
• EPS Growth: N/A
• Country: DE
• Employees: 12,892
• Sector: Industrials
• Sector Strength: 76
• Industry: Aerospace & Defense
• EPS (TTM): 4.77
• Shares Outstanding: 53,824,490
• 10 Day Avg. Volume: 86,206
• 30 Day Avg. Volume: 116,608
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €425.50
• Price Target Upside: 11.59% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 75 Outperform
• Price Target: €422.00 ▲(10.67% Upside)

MTU Aero Engines shows a strong financial performance with robust revenue growth and profitability improvements. Technical indicators are mixed, showing no clear trend. The company's valuation suggests moderate growth potential with a focus on reinvestment, appealing to growth investors. Absence of recent earnings call information and corporate events limits additional insights.

Positive Factors

Aftermarket Performance

Aftermarket strength is driving 21% EBIT growth for MTU Aero Engines.

Earnings

MTU posted a strong Q2, with a 1% beat to consensus on sales, but a 19% beat on EBIT pushing margins to 17.4%.

Guidance and Targets

The recently raised guidance is confirmed.

Negative Factors

Aircraft Storage

The number of aircraft on ground for the A320 is now around 655 aircraft, indicating a higher level of storage than desired.

Foreign Exchange Concerns

FX remains a key point of concern for investors.

Parts Availability

Parts availability remains a key limiting factor, and is not expected to fully normalize until later this year.

MTU Aero Engines Business Overview & Revenue Model

Company Description

MTU Aero Engines AG, together with its subsidiaries, develops, manufactures, markets, and maintains commercial and military engines, and aero derivative industrial gas turbines in Germany, other European countries, North America, Asia, and internationally. It operates through two segments, Commercial and Military Engine Business; and Commercial Maintenance Business. The company offers commercial aircraft engines for wide body jets, narrow body and regional jets, and business jets; military aircraft engines for fighter aircraft, helicopters, and transport aircraft; and industrial gas turbines. It also maintains, repairs, and overhauls commercial and military engines; and manufactures and markets various brush seals. The company was formerly known as MTU Aero Engines Holding AG and changed its name to MTU Aero Engines AG in May 2013. MTU Aero Engines AG was founded in 1913 and is headquartered in Munich, Germany.

How the Company Makes Money

MTU Aero Engines generates revenue through a diversified business model that includes several key streams. The primary source of income comes from the sale of aircraft engines to OEMs, including major players in the aviation industry. Additionally, MTU earns substantial revenue from its aftermarket services, which encompass maintenance, repair, and overhaul (MRO) services for existing engines, providing ongoing support to airlines and operators. Strategic partnerships with other aerospace manufacturers, such as collaborations on engine programs, further enhance revenue opportunities. Furthermore, MTU's involvement in research and development projects, often funded by government contracts and partnerships, contributes to its overall financial performance.

MTU Aero Engines Financial Statement Overview

Summary

MTU Aero Engines has demonstrated a strong financial recovery with significant improvements in revenue and profitability. The balance sheet is solid, though high liabilities require ongoing attention. Cash flow generation is stable, but modest free cash flow growth suggests room for enhancement.

Income Statement

MTU Aero Engines has shown strong revenue growth from 2023 to 2024, with a significant recovery in gross profit margin to 16.6% and a remarkable improvement in net profit margin to 8.7%. The EBITDA margin increased to 16.5%, indicating robust operational performance. The EBIT margin has also improved significantly, reflecting better cost management. These metrics show a strong recovery and growth trajectory, although the previous year had a challenging performance.

Balance Sheet

The company's balance sheet indicates a solid financial position with a debt-to-equity ratio of 0.84, which is reasonable for the industry. The equity ratio stands at 26.9%, showing a strong capital structure. Return on equity improved to 19.1%, demonstrating efficient management of shareholder investments. However, the high total liabilities may pose potential risks if not managed carefully.

Cash Flow

MTU Aero Engines' cash flow statement reveals stable operating cash flow, although free cash flow growth has been modest. The operating cash flow to net income ratio is robust at 1.11, indicating good cash generation from operations. However, the free cash flow to net income ratio is relatively low, suggesting potential limitations in reinvesting in growth opportunities.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.41B	5.36B	5.33B	4.19B	3.98B
Gross Profit	1.23B	125.00M	855.00M	586.00M	492.00M
EBITDA	1.22B	196.00M	677.00M	519.00M	382.00M
Net Income	633.00M	-102.00M	331.00M	222.00M	139.00M
Balance Sheet
Total Assets	12.48B	10.20B	9.23B	8.30B	8.10B
Cash, Cash Equivalents and Short-Term Investments	1.75B	1.54B	1.21B	885.00M	811.00M
Total Debt	2.43B	1.27B	1.30B	1.31B	1.45B
Total Liabilities	9.06B	7.27B	6.12B	5.54B	5.47B
Stockholders Equity	3.36B	2.86B	3.03B	2.68B	2.55B
Cash Flow
Free Cash Flow	74.00M	365.00M	326.00M	200.00M	130.00M
Operating Cash Flow	714.00M	777.00M	728.00M	567.00M	386.00M
Investing Cash Flow	-603.00M	-420.00M	-400.00M	-345.00M	-245.00M
Financing Cash Flow	736.00M	-294.00M	-224.00M	-276.00M	504.00M

MTU Aero Engines Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 381.30
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:MTX, the sentiment is Positive. The current price of 381.3 is below the 20-day moving average (MA) of 381.41, above the 50-day MA of 377.51, and above the 200-day MA of 336.23, indicating a bullish trend. The MACD of 2.39 indicates Positive momentum. The RSI at 54.11 is Neutral, neither overbought nor oversold. The STOCH value of 35.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:MTX.

MTU Aero Engines Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTX	75 Outperform	€20.69B	24.11	24.74%	0.58%	45.24%	―
Sector *	64 Neutral	$10.95B	16.37	8.81%	1.96%	2.68%	-15.33%
0O1R	―	€6.90B	17.48	8.49%	―	―	―
0FH7	―	€1.25B	222.22	1.42%	0.89%	―	―
0NI1	―	€74.94B	87.81	21.91%	―	―	―
8TRA	79 Outperform	€16.06B	7.44	12.80%	5.35%	-2.98%	-14.55%
HAG	66 Neutral	€10.14B	111.37	11.52%	0.58%	18.53%	73.20%