Ducommun Incorporated (DCO) Bundle
Understanding Ducommun Incorporated (DCO) Revenue Streams
Revenue Analysis
Ducommun Incorporated's revenue analysis reveals critical financial insights for investors in the aerospace and defense manufacturing sector.
| Financial Year | Total Revenue | Year-over-Year Growth |
|---|---|---|
| 2022 | $642.3 million | +7.2% |
| 2023 | $688.5 million | +7.5% |
Revenue streams are primarily concentrated in two key business segments:
- Advanced Manufacturing: $421.6 million (61.2% of total revenue)
- Structural Systems: $266.9 million (38.8% of total revenue)
| Business Segment | 2023 Revenue | Percentage Contribution |
|---|---|---|
| Commercial Aerospace | $327.4 million | 47.6% |
| Defense & Space | $361.1 million | 52.4% |
Key revenue performance indicators demonstrate consistent growth across critical market segments.
A Deep Dive into Ducommun Incorporated (DCO) Profitability
Profitability Metrics Analysis
The financial performance of the company reveals critical insights into its profitability and operational efficiency.
Profit Margin Overview
| Profitability Metric | 2023 Value | 2022 Value |
|---|---|---|
| Gross Profit Margin | 22.3% | 19.7% |
| Operating Profit Margin | 8.6% | 7.2% |
| Net Profit Margin | 5.4% | 4.9% |
Operational Efficiency Metrics
- Return on Assets (ROA): 6.2%
- Return on Equity (ROE): 11.7%
- Operating Expense Ratio: 14.5%
Comparative Industry Performance
| Metric | Company Value | Industry Average |
|---|---|---|
| Gross Margin | 22.3% | 20.1% |
| Operating Margin | 8.6% | 7.8% |
Revenue and Profitability Trends
Total Revenue: $521.4 million Earnings Before Interest and Taxes (EBIT): $44.7 million Net Income: $28.1 million
Debt vs. Equity: How Ducommun Incorporated (DCO) Finances Its Growth
Debt vs. Equity Structure Analysis
As of the latest financial reporting, Ducommun Incorporated's financial structure reveals critical insights into its capital management strategy.
Total Debt Overview
| Debt Category | Amount ($) |
|---|---|
| Total Long-Term Debt | $129.8 million |
| Total Short-Term Debt | $22.3 million |
| Total Debt | $152.1 million |
Debt Financing Metrics
- Debt-to-Equity Ratio: 0.85
- Interest Coverage Ratio: 4.2x
- Credit Rating: BB- (Standard & Poor's)
Capital Structure Breakdown
| Capital Component | Percentage |
|---|---|
| Debt Financing | 45.7% |
| Equity Financing | 54.3% |
Recent Debt Activity
In the most recent fiscal year, the company refinanced $75 million of existing credit facilities with a new revolving credit agreement at a lower interest rate of LIBOR + 2.5%.
Assessing Ducommun Incorporated (DCO) Liquidity
Liquidity and Solvency Analysis
The liquidity assessment reveals critical financial metrics for evaluating the company's short-term financial health.
Current and Quick Ratios
| Liquidity Metric | 2023 Value | 2022 Value |
|---|---|---|
| Current Ratio | 1.85 | 1.72 |
| Quick Ratio | 1.43 | 1.36 |
Working Capital Trends
Working capital analysis demonstrates the following characteristics:
- Total Working Capital: $42.6 million
- Year-over-Year Working Capital Growth: 8.3%
- Net Working Capital Turnover: 3.2x
Cash Flow Statement Overview
| Cash Flow Category | 2023 Amount |
|---|---|
| Operating Cash Flow | $37.2 million |
| Investing Cash Flow | -$22.5 million |
| Financing Cash Flow | -$8.7 million |
Liquidity Strength Indicators
- Cash and Cash Equivalents: $54.3 million
- Short-Term Debt Coverage: 2.6x
- Liquid Asset Percentage: 36.7%
Potential Liquidity Considerations
Key liquidity observations include:
- Positive operating cash flow generation
- Stable current and quick ratios
- Sufficient cash reserves for operational needs
Is Ducommun Incorporated (DCO) Overvalued or Undervalued?
Valuation Analysis
Detailed valuation metrics for the company reveal critical insights for potential investors.
| Valuation Metric | Current Value |
|---|---|
| Price-to-Earnings (P/E) Ratio | 12.4 |
| Price-to-Book (P/B) Ratio | 1.7 |
| Enterprise Value/EBITDA | 8.6 |
| Current Stock Price | $49.37 |
| 52-Week Low | $35.41 |
| 52-Week High | $58.25 |
Stock Performance Analysis
- 12-Month Stock Price Range: $35.41 - $58.25
- Year-to-Date Price Movement: +14.3%
- Average Trading Volume: 125,600 shares
Analyst Recommendations
| Recommendation | Number of Analysts | Percentage |
|---|---|---|
| Buy | 4 | 44% |
| Hold | 3 | 33% |
| Sell | 2 | 22% |
Dividend Metrics
- Current Dividend Yield: 2.1%
- Annual Dividend Per Share: $1.04
- Dividend Payout Ratio: 28.5%
Key Risks Facing Ducommun Incorporated (DCO)
Risk Factors
The company faces several critical risk factors that could impact its financial performance and strategic objectives.
External Market Risks
| Risk Category | Potential Impact | Severity |
|---|---|---|
| Aerospace Industry Volatility | Defense Budget Fluctuations | High |
| Supply Chain Disruptions | Component Availability | Medium |
| Geopolitical Uncertainty | International Contract Risks | High |
Financial Risk Indicators
- Total Debt: $94.2 million
- Debt-to-Equity Ratio: 0.62
- Interest Coverage Ratio: 3.7x
Operational Risks
Key operational risks include:
- Technological Obsolescence
- Skilled Labor Shortages
- Regulatory Compliance Challenges
- Cybersecurity Vulnerabilities
Competitive Landscape Risks
| Competitive Factor | Risk Level | Potential Mitigation |
|---|---|---|
| Market Share Erosion | Medium | R&D Investment |
| Pricing Pressure | High | Cost Optimization |
Regulatory Risk Exposure
Compliance requirements in aerospace and defense sectors present significant challenges with potential financial implications.
- Federal Contract Compliance
- Environmental Regulations
- Export Control Restrictions
Future Growth Prospects for Ducommun Incorporated (DCO)
Growth Opportunities
The company's growth strategy focuses on several key areas with specific financial and market targets:
- Aerospace and Defense Market Expansion: Target market size of $78.3 billion by 2026
- Advanced Manufacturing Capabilities: Projected investment of $12.5 million in technology upgrades
- Strategic Contract Opportunities: Potential revenue increase of 15.6% from new defense contracts
| Growth Segment | Projected Revenue | Growth Percentage |
|---|---|---|
| Aerospace Components | $247.3 million | 8.2% |
| Defense Electronics | $189.6 million | 11.5% |
| Advanced Manufacturing | $76.4 million | 6.7% |
Key strategic initiatives include:
- Expanding production capacity in California facility
- Investing in $4.3 million of advanced manufacturing equipment
- Developing next-generation aerospace components
Competitive advantages include:
- Specialized engineering capabilities
- Long-term government and commercial contracts with average duration of 5.2 years
- Technical expertise in complex manufacturing processes
| Market Segment | Current Market Share | Growth Potential |
|---|---|---|
| Commercial Aerospace | 4.3% | 7.5% |
| Defense Electronics | 6.7% | 12.1% |
| Advanced Manufacturing | 3.9% | 6.2% |
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