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Loar Holdings Inc. (LOAR)
NYSE:LOAR
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Loar Holdings Inc.
(NYSE:LOAR)
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Rating:71Outperform
Price Target:
$86.00
▲(8.83% Upside)
Loar Holdings Inc. demonstrates strong financial performance and positive earnings call sentiment, which are the primary drivers of the stock score. The technical analysis suggests short-term bullish momentum, but caution is advised due to potential overvaluation and overbought signals. The absence of a dividend yield and high P/E ratio weigh down the valuation score.
Positive Factors
Revenue Growth
Strong revenue growth indicates effective market penetration and product demand, supporting long-term business expansion and shareholder value.
Cash Flow Management
Efficient cash flow management enhances financial flexibility, allowing for strategic investments and debt reduction, bolstering long-term stability.
Acquisition Strategy
Strategic acquisitions like Beadlight can drive future growth and diversification, strengthening the company's competitive position and market reach.
Negative Factors
Choppy Commercial OE Growth
Supply chain and inventory challenges can hinder consistent growth, impacting operational efficiency and potentially affecting future revenue stability.
Regulatory Delays
Regulatory delays in acquisitions can stall strategic growth plans, affecting the company's ability to quickly capitalize on market opportunities.
Low Return on Equity
A low return on equity suggests limited efficiency in generating profits from shareholders' equity, indicating potential for improved financial performance.
Loar Holdings Inc. (LOAR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.40B
Dividend YieldN/A
Average Volume (3M)940.89K
Price to Earnings (P/E)168.2
Beta (1Y)1.09
Revenue Growth26.15%
EPS Growth251.10%
CountryUS
Employees1,500
SectorGeneral
Sector StrengthN/A
IndustryAerospace & Defense
Share Statistics
EPS (TTM)0.23
Shares Outstanding93,622,475
10 Day Avg. Volume760,640
30 Day Avg. Volume940,886
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.14
Enterprise Value/Revenue18.74
Enterprise Value/Gross Profit37.58
Enterprise Value/Ebitda59.94
Forecast
1Y Price Target
$92.33Price Target Upside16.84% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Loar Holdings Inc. Business Overview & Revenue Model
Company DescriptionLoar Holdings, Inc. engages in the design, manufacture, and sale of niche aerospace and defense components for aircraft, aerospace and defense systems. The company was founded on August 21, 2017 and is headquartered in White Plains, NY.
How the Company Makes MoneyLoar Holdings Inc. generates revenue through multiple streams, including equity stakes in its portfolio companies, dividends from investments, and capital appreciation from asset sales. The company actively manages its investments to ensure optimal performance, often seeking synergies among its holdings to maximize returns. Additionally, LOAR engages in strategic partnerships with industry leaders to enhance its market reach and operational efficiency. These collaborations not only provide financial benefits but also contribute to the development of innovative products and services within its sectors of focus.
Loar Holdings Inc. Earnings Call Summary
Earnings Call Date:Aug 13, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Positive
The earnings call reflected a strong performance with record sales and EBITDA growth, driven by solid execution across multiple sectors. However, some challenges in commercial OE growth and regulatory delays for an acquisition were noted. Overall, the positive highlights significantly outweighed the lowlights.Q2-2025 Updates
Positive Updates
Record Sales and Growth
Loar Holdings achieved record sales of $123 million in Q2 2025, representing a 13% increase compared to the prior year, driven by strong performances across commercial aftermarket, commercial OEM, and defense sectors.
Strong EBITDA Performance
The company reported adjusted EBITDA up $12 million from Q2 2024, with margins at a record 38.3%, an increase of 220 basis points from the previous year.
High Cash Flow Conversion
Cash flow conversion percentages of 175% and 125% for the first two quarters of 2025, with a year-to-date average of 148%, exceeding the company's target of 125% for the year.
Successful Acquisition of Beadlight
Loar Holdings acquired Beadlight, a UK-based lighting products company, expected to bring significant growth and accretive results starting in 2026.
Negative Updates
Choppy Commercial OE Growth
Challenges in managing inventory levels and supply chain issues have resulted in choppy growth rates for the commercial OE segment, leading to a cautious stance on organic growth projections.
Regulatory Delays in LMB Acquisition
The acquisition of LMB Fans & Motors is in a holding pattern pending regulatory approval, with potential delays affecting the closing timeline.
Company Guidance
In the second quarter of 2025, Loar Holdings reported exceeding all performance metrics, including record sales, adjusted EBITDA, and adjusted EBITDA margins. The company achieved a compound annual growth rate of 37% in sales and 45% in adjusted EBITDA since its inception, with recent organic sales growth of 18%, 14%, and 15% over the past three years. For 2025, Loar Holdings projects net sales between $486 million and $494 million and adjusted EBITDA between $184 million and $187 million, with an adjusted EBITDA margin of approximately 38%. The company also anticipates low double-digit growth in commercial aftermarket sales and 17% to 20% growth in defense sales. The cash flow conversion percentages for the first two quarters of 2025 were 175% and 125%, respectively, with a year-to-date figure of 148%. The guidance reflects the company's confidence in its value drivers and proprietary portfolio, with no anticipated impact from current tariff environments. Additionally, Loar Holdings' recent acquisition of Beadlight is expected to be accretive in 2026.Loar Holdings Inc. Financial Statement Overview
Summary
Loar Holdings Inc. shows a positive financial trajectory with strong revenue growth and improved profitability. The balance sheet is robust with reduced leverage, enhancing financial stability. Cash flow management is a standout, with significant improvements in free cash flow, supporting strategic initiatives. Continued focus on operational efficiency and return on equity could further strengthen financial performance.Income Statement
Loar Holdings Inc. demonstrated strong revenue growth with a 26.9% increase from 2023 to 2024. The gross profit margin improved to 49.4% in 2024, indicating efficient cost management. Net profit margin turned positive to 5.5% from a negative position, showcasing a significant turnaround. However, the EBIT margin of 21.8% and EBITDA margin of 30.8% suggest room for improvement in operational efficiency.78
Positive
Balance Sheet
The company has a solid equity base with an equity ratio of 75.0%, indicating financial stability. The debt-to-equity ratio improved significantly to 0.26, reflecting reduced leverage. Return on equity increased to 2.0%, showing better profitability, though still modest. The balance sheet is strong, but the low ROE suggests potential for enhanced returns.72
Positive
Cash Flow
Operating cash flow increased substantially, leading to a strong free cash flow growth rate. The operating cash flow to net income ratio of 2.47 indicates efficient cash generation relative to earnings. The free cash flow to net income ratio of 2.07 further underscores robust cash flow management, supporting future investments and debt reduction.85
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 451.74M | 402.82M | 317.48M | 239.43M |
| Gross Profit | 225.25M | 198.82M | 154.26M | 111.50M |
| EBITDA | 141.24M | 124.24M | 107.52M | 73.42M |
| Net Income | 44.37M | 22.23M | -4.62M | -2.47M |
Balance Sheet | ||||
| Total Assets | 1.50B | 1.45B | 1.05B | 994.52M |
| Cash, Cash Equivalents and Short-Term Investments | 103.34M | 54.07M | 21.49M | 35.50M |
| Total Debt | 9.43M | 286.43M | 545.48M | 496.44M |
| Total Liabilities | 369.49M | 362.11M | 632.30M | 572.55M |
| Stockholders Equity | 1.13B | 1.09B | 418.14M | 421.97M |
Cash Flow | ||||
| Free Cash Flow | 80.10M | 46.10M | 679.00K | 5.34M |
| Operating Cash Flow | 89.24M | 54.97M | 12.81M | 13.27M |
| Investing Cash Flow | -393.01M | -392.13M | -72.56M | -181.83M |
| Financing Cash Flow | 334.15M | 370.02M | 45.72M | 135.31M |
Loar Holdings Inc. Technical Analysis
Positive
79.02
Price Trends
74.03
Positive
79.60
Negative
77.99
Positive
Market Momentum
1.33
Positive
57.53
Neutral
41.00
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LOAR, the sentiment is Positive. The current price of 79.02 is above the 20-day moving average (MA) of 77.31, above the 50-day MA of 74.03, and above the 200-day MA of 77.99, indicating a bullish trend. The MACD of 1.33 indicates Positive momentum. The RSI at 57.53 is Neutral, neither overbought nor oversold. The STOCH value of 41.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LOAR.
Loar Holdings Inc. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $5.04B | 58.85 | 5.66% | 1.04% | 1.92% | -15.47% | |
71 Outperform | $7.40B | 168.24 | 4.70% | ― | 26.15% | 251.10% | |
63 Neutral | $4.60B | -117.75 | -2.57% | ― | 9.19% | 72.88% | |
63 Neutral | $9.05B | ― | 6.48% | ― | ― | ― | |
50 Neutral | $5.49B | 105.57 | 1.17% | ― | ― | ― | |
43 Neutral | $4.66B | -1.98 | 81.63% | ― | -2.60% | -94.76% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
LOAR
Loar Holdings Inc.
79.02
4.43
5.94%
HXL
Hexcel
63.37
2.25
3.68%
MRCY
Mercury Systems
76.82
39.82
107.62%
SPR
Spirit AeroSystems
39.65
7.14
21.96%
AMTM
Amentum Holdings, Inc.
22.57
-9.68
-30.02%
KRMN
Karman Holdings Inc.
68.42
36.42
113.81%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.