Gulfstream Aerospace GAC Message Board

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Non-Tech : Gulfstream Aerospace GAC

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To: Mel Spivak who wrote (84)	2/10/1998 3:10:00 PM
From: Creighton C. Smith	Read Replies (1) of 197

> Nice #'s Why so much better than last year? Caveat: I am long GAC. Gulfstream is in the middle of a successful turnaround. Improved numbers are largely attributable to margin improvements and greatly increased production. Q4 & FY'97 EPS beat analysts expectations, and management stated that they expected FY'98 EPS to come in at about $2.85, well above current analysts' estimates of $2.44 (Zacks consensus). > Why will things keep up at this pace? 1} Margins should continue to improve as company gets better and better at making the new Gulfstream V (GV) long-range jet. 2) Management has committed to increasing production to 60 aircraft per year, and is, in fact, well ahead of schedule in achieving this goal. 1997 saw 51 aircraft delivered vs. 27 in 1996. 3) The market for long range corporate jets is expected to continue to expand. 4) In my opinion, the stock has been depressed due to concerns over management's ability to bring Gulfstream back from the ragged edge of bankruptcy. Now, with two years of increasingly profitable operation under their belts, management is no longer the question it once (quite reasonably) was to the institutional investors. Just my $0.02 __Creighton

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