(KFI) - fourth straight quarter in which the company beat the Street's earnings estimate

K&F Industries Holdings, Inc. (KFI), a Zacks #1 Rank stock, topped analysts' earnings expectations for the past four quarters by an average margin of 13.8%. After posting solid results for the second quarter and first six months of 2006, the company revised its revenue, EBITA and earnings per share guidance upward. KFI has a price-to-book ratio of only 1.9, compared to 4.0 for the market. Full Analysis K&F Industries Holdings, Inc. designs, develops, manufactures and distributes wheels, brakes and brake control systems for commercial transport, military and general aviation aircraft. The company also produces aircraft fuel tanks, de-icing equipment and coated fabrics for environmental, storage and transport applications. When KFI reported its financial results for the second quarter on Aug 8, it marked the fourth straight quarter in which the company beat the Street's earnings estimate. Profits for the quarter came in at 28 cents per share, beating the consensus estimate by 12%. Revenues advanced 13.7% to $102.7 million. For the first six months of the year, profits amounted to $21.6 million, compared to $3.9 million for the first six months of 2005. Revenues jumped 8.2% to $193.7 million. President and CEO Kenneth M. Schwartz stated, "2006 continues to progress towards a record year for sales, bookings and adjusted EBITDA." As a result, the company raised its 2006 guidance and now expects revenues between $415 million and $423 million, EBITDA between $162 million and $166 million and earnings per share between $1.24 and $1.29. The company's previous forecast called for revenues between $408 million and $415 million, EBITDA between $160 million and $163 million and earnings per share between $1.22 and $1.27. Analysts have grown increasingly optimistic due to KFI's second-quarter results and bullish outlook. The consensus estimate for this year currently sits at $1.27 and represents a 4.1% increase when compared to the consensus of a week earlier. Profit forecasts for next year jumped by an even great magnitude--9.0% to $1.45. The company is currently trading at a discounted valuation of 13.4x trailing 12-month and current fiscal-year earnings. The market, as represented by the S&P 500, is trading at a valuation of 16.0x trailing 12-month earnings and at 15.3x its current fiscal-year estimated earnings. The company has a price-to-book ratio of only 1.9, compared to 4.0 for the market. KFI's return on equity of 14% is in line with the industry average. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. | Blog Home| VitalStocks Home