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what it is
Woodward makes the control systems that help aircraft and industrial machines run cleaner, safer, and with less drama.
how it gets paid
Last year Woodward made $3.6B in revenue. Aerospace domestic was the main engine at $1.26B, or 35% of sales.
why it's growing
Revenue grew 7.3% last year. Quarterly sales rose 29% vs. prior year, while EPS climbed 53% from $1.42 to $2.17.
what just happened
Woodward's latest quarter was a clean beat, with revenue hitting $996M and EPS landing at $2.17.
At a glance
A balance sheet — strong enough to weather a downturn
65/100 earnings predictability — reasonably predictable
55.1x trailing p/e — you're paying up for this one
0.4% dividend yield — cash in your pocket every quarter
17.0% return on capital — nothing to write home about
xvary composite: 75/100 — average
What they do
Woodward makes the control systems that help aircraft and industrial machines run cleaner, safer, and with less drama.
Woodward sits in the parts of aerospace and industrial systems where failure is expensive and testing takes years. Aerospace was 65% of fiscal 2025 sales, so once your engine or aircraft platform uses its controls, switching vendors is painful. The company also carries an A balance sheet grade from, which means it can keep investing while weaker suppliers ration cash.
How they make money
$3.6B
annual revenue · their business grew +7.3% last year
Aerospace domestic (approx.)
$1.26B
Aerospace foreign (approx.)
$1.08B
Industrial domestic (approx.)
$0.68B
Industrial foreign (approx.)
$0.58B
The products that matter
controls for aircraft systems
Aerospace Control Systems
~65% of sales · roughly $2.3B implied
this is the center of gravity. About 65% of the $3.6B business comes from aerospace, which is why the stock trades with the aerospace cycle whether you want it to or not.
core segment
controls for industrial equipment
Industrial Control Systems
~35% of sales · roughly $1.3B implied
industrial is the smaller leg of the stool at about 35% of revenue. It matters because it keeps Woodward from being a pure aerospace bet, but it does not change who drives the story.
diversifier
business being wound down
Onhighway Natural Gas Business
exit targeted by fiscal 2026
management is winding this business down after failing to find a buyer, with completion planned by the end of fiscal 2026. It's small enough not to define Woodward, but it tells you management is pruning what no longer fits.
being exited
Key numbers
55.1x
trailing p/e
You are paying $55.10 for each $1 of trailing earnings, which leaves little room for a stumble.
17.0%
return on capital
Return on capital → profit generated from money invested → so what: Woodward turns investment into solid earnings better than many industrial peers.
14.0%
operating margin
Operating margin → profit after running the business → so what: Woodward keeps $14 on every $100 of sales before interest and taxes.
$457M
long-term debt
That is just 2% of capital, which means the balance sheet is unusually clean for a $23B company.
Financial health
A
strength
- balance sheet grade A — very strong financial position
- risk rank 3 — safer than 50% of stocks
- price stability 65 / 100
- long-term debt $457M (2% of capital)
- net profit margin 14.5% — keeps 14 cents of every dollar in revenue
- return on equity 16% — $0.16 profit for every $1 investors have put in
A — among the top-rated companies for balance sheet quality.
Total return vs. market
You invested $10,000 in WWD 3 years ago → it's now worth $37,330.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
Woodward's latest quarter was a clean beat, with revenue hitting $996M and EPS landing at $2.17.
Quarterly sales rose 29% vs. prior year, while EPS climbed 53% from $1.42 to $2.17. That follows fiscal 2025 revenue growth of 7.3% and non-GAAP EPS growth of 13%.
$996M
revenue
$2.17
eps
14.0%
operating margin
the number that mattered
The key number was 29% revenue growth, because that is far faster than the company's 7.0% projected long-term sales growth rate from.
-
woodward reported strong results for the first quarter of fiscal 2026. (year ends september 30th.) sales rose 29% vs. prior year, while earnings per share were up a whopping 61%.the company’s recent strategic focus has been on growing its aerospace segment in order to meet elevated demand, and that growth helped propel the company’s first-quarter performance. importantly, woodward did not see the typical seasonal downturn in the quarter, which also contributed to the exceptionally strong comparison. looking ahead, comparisons will be more difficult, but strong growth should persist, albeit to a less extreme degree.
-
we estimate roughly 27% earnings growth for fiscal 2026, with a further 14% growth in fiscal 2027.
-
all of this comes on the heels of a good performance in fiscal 2025.
-
for the year, woodward reported 7% sales growth and 13% earnings growth. (as a reminder, we switched to using non-gaap earnings figures for woodward beginning with fiscal 2025, so the numbers on this page aren’t directly comparable; the preceding comparison was made by comparing the adjusted earnings figures from the two years in question.) the company faced several major headwinds over the course of the year, including labor issues affecting a major customer and tariff-related slowdowns in foreign sales, but ultimately managed to turn in decent results while also laying the groundwork for its current success via acquisitions and a renewed focus on the aerospace segment.the company is further narrowing its focus with the winding down of its onhighway natural gas truck business in china. the decision to wind down the business followed a years-long effort to find a buyer that, ultimately, never materialized. in order to refocus its industrial segment on ventures with greater growth potential, woodward is at last pulling the plug.
-
the wind-down is scheduled to be completed by the end of the fiscal year.
source: company earnings report, 2026
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What could go wrong
the #1 risk is aerospace end-market concentration.
med
aerospace downturn
65% of sales come from aerospace. If commercial builds, flight activity, or defense demand soften, Woodward does not have a lot of hiding places.
Revenue exposure: 65% of the $3.6B business. That's the main risk because it hits the core engine, not a side project.
med
too much riding on a few relationships
36% of revenue comes from five customers. That concentration can help when programs ramp. It also means a single lost program or procurement shift matters more than it would at a broader supplier.
Revenue exposure: 36% tied to five customers. You are underwriting relationship durability, not just product quality.
med
the multiple already assumes a lot
At 55.1x trailing earnings and roughly 43x forward earnings based on the $8.75 estimate, Woodward is priced for continued delivery. Good results may only justify the stock. Great results are what the multiple really wants.
Expectation gap: analysts see a $330 midpoint target against a $379 stock. The stock is already ahead of the published target set.
med
foreign sales add another moving part
46% of sales are foreign. That brings currency translation, geopolitical noise, and cross-border demand swings into reported results.
Revenue exposure: almost half the business is outside the domestic market. Even when underlying demand is fine, reported numbers can move around.
With 65% of sales tied to aerospace, 36% tied to five customers, and 46% tied to foreign markets, this is not a diversified industrial. It's a focused operator with a premium multiple. That combination works until it doesn't.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
fiscal 2026 EPS growth vs. 27%
that 27% earnings growth estimate is doing a lot of work in the valuation. If the business lands below it, the stock loses one of its main defenses.
trend
aerospace demand staying hot
recent strength was led by aerospace. You want to see that remain the growth engine, because 65% of revenue says the rest of the business cannot offset a meaningful slowdown.
risk
customer concentration not getting worse
36% of sales coming from five customers is manageable. A higher share would make the story more fragile, not stronger.
calendar
china wind-down finished by fiscal 2026
management plans to complete the onhighway natural gas exit by the end of fiscal 2026. You want that distraction closed, not extended.
Analyst rankings
short-term outlook
top 20%
momentum score 2 — analysts expect above-average price performance in the year ahead. in human-speak, they still like the setup despite the valuation.
risk profile
average
stability score 3 — this sits in the middle. Not especially defensive. Not especially wild.
chart momentum
average
technical score 3 — the chart is not flashing a dramatic signal. The fundamentals are doing more of the talking.
earnings predictability
65 / 100
predictability is decent, not pristine. Expect the occasional surprise, especially when aerospace demand changes speed.
source: institutional data
Institutional activity
institutions have been net buying for 2 consecutive quarters — 266 buyers vs. 238 sellers in 3q2025. total institutional holdings: 54.0M shares. net buying for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$197
$463
$379
current price
$330
target midpoint · 13% from current · 3-5yr high: $405 (+5% · 2% ann'l return)
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