Curtiss Wright (CW) Wins New Defense Work, Is The Stock Cheap After The Selloff?
Curtiss-Wright (CW) is back in focus after securing approximately US$40 million in contracts from Leidos to support the U.S. Army’s Indirect Fire Protection Capability Increment 2 air defense system.
Curtiss-Wright’s latest contract win lands after a sharp reset in sentiment, with the share price down 24.3% over the past 30 days and 22.7% over 90 days. However, the 1-year total shareholder return of 17.8% and very large 5-year total shareholder return above 4x suggest longer term momentum has remained strong.
Compare Curtiss-Wright’s reset with other defense and industrial contractors that also combine long-term growth records with recent share price pressure by scanning our hand picked 47 high quality undervalued stocks.
The selloff has reset Curtiss-Wright’s share price even as contracts and guidance updates keep arriving. Does that shift the risk reward balance in favour of new buyers, or are investors still paying up for quality here?
Most Popular Narrative: 27.9% Undervalued
The most followed Curtiss-Wright narrative sees fair value at $786.29 versus the last close at $566.75, which sets up a sizeable valuation gap for investors to assess.
Record backlog growth (+12% YTD to $3.8b), strong book-to-bill ratios (1.2x in A&D), and a healthy order pipeline in both defense and nuclear align with management's confidence in posting 9 to 10% sales growth, 16 to 19% EPS growth, and over 100 bps of margin expansion in 2025, signaling undervaluation if current pricing underappreciates this forward visibility and operational leverage.
Want to see what underpins that verdict on Curtiss-Wright? The narrative leans heavily on compounding earnings, expanding margins, and a richer future earnings multiple. The mix of growth assumptions and required return is more aggressive than the headline numbers suggest. The full story joins these pieces into one valuation case.
Result: Fair Value of $786.29 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, the Curtiss-Wright narrative still hinges on large defense and nuclear contracts being renewed on schedule, as well as on nuclear buildout plans progressing without major policy reversals.
Find out about the key risks to this Curtiss-Wright narrative.
Another View: Curtiss-Wright Through The Earnings Multiple Lens
Curtiss-Wright currently trades on a P/E of 38.7x, which is lower than the 80.6x peer average but higher than both the US Aerospace & Defense industry at 36.6x and its own fair ratio of 24.8x. That mix points to quality, yet also to valuation risk if the market moves toward that lower fair ratio.
For a closer look at how that P/E gap could close over time, including the fair ratio that the market could move toward, take a look at the valuation breakdown, See what the numbers say about this price — find out in our valuation breakdown.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Curtiss-Wright for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 47 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.
Next Steps
If the Curtiss-Wright story so far sounds compelling or cautious, do not wait around to check the numbers and stress test the thesis for yourself. To see what investors are optimistic about, start by reviewing the 3 key rewards.
Looking for more investment ideas beyond Curtiss-Wright?
Do not stop your research with Curtiss-Wright. Broaden your watchlist using focused stock ideas that match how you like to balance return potential with risk.
- Target potential mispricings by scanning a curated collection of quality companies that may be trading below their estimated value through the 47 high quality undervalued stocks.
- Strengthen your income stream by reviewing businesses that aim to combine higher yields with resilience using the 11 dividend fortresses.
- Prioritize capital preservation by filtering for companies that score well on balance sheet strength and fundamentals with the list of solid balance sheet and fundamentals (52 results).
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com