TATT stocks rise on new deal with Honeywell. Time to buy?

Stocks of TAT Technologies Ltd. (TATT:US, NASDAQ:TATT), an aerospace and defense firm, opened over 60 per cent higher on Friday, July 2.

This surge came after the company’s subsidiary, TAT Piedmont, announced on Thursday, July 1, that it has entered a deal with accelerated processing unit (APU) manufacturer Honeywell to repair its auxiliary power units.

The maintenance, repair and operations (MRO) contract is likely to boost TAT’s top line. The company’s CEO and president, Igal Zamir, said that he foresees a massive rise in its incomes in the next few years as the aviation sector rebounds from the pandemic.

Let us glance at this industrial stock’s fundamentals and price-performance:

TAT Technologies Ltd. (TATT:US, NASDAQ:TATT)

The aerospace and defense stock was trading at US$ 9.09 apiece on Friday morning (10:22AM EST). It has delivered over 141 per cent equity growth in the past one year.

TATT stock has returned over 75 per cent in the last one quarter. It has also gained 99 per cent this year, beating the S&P 500 Aerospace & Defense (Sub Industry) Index’s growth of 13.26 per cent by a significant margin.

On technical measures, TATT share price is up 14.80 per cent against its 200-day simple moving average, indicating a bull run.

TAT Technologies saw about 22 million of its shares change hand within the first two hours of trading on Friday. However, its 30-day average volume stands at 35,936 shares, as against its total outstanding shares of around 8.8 million.

TAT Technologies’ one-year stock performance against moving average multiple. (Source: Refinitiv)

TAT stock’s price trajectory has surpassed its moving average multiple and has outperformed its previous one-year high of US$ 8.34 (January 6, 2021).

The script has improved as much as 165 per cent from its one-year low of US$ 3.40 apiece (July 6, 2020).

TAT Technologies reported a revenue surge of 11 per cent quarter-over-quarter (QoQ) to US$ 18.3 million in the first quarter of 2021, up from US$ 16.5 million in Q4 2020. Its gross profit stood at US$ 3.4 million in Q1 2021, up 259 per cent QoQ.

Its adjusted EBITDA of US$ 1.6 million in the latest quarter was up against that of US$2.7 million in Q4 2020.

Please note: The above constitutes a preliminary view and any interest in stocks and cryptocurrencies should be evaluated further from an investment point of view. The reference data in this article has been partly sourced from Refinitiv.

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