Mgmt Mtg Takes: MV-75 Funding Gap NT but FY27 Budget Stabilizes to Army‘s Plan

研报英文原文证据摘录

Mgmt Mtg Takes: MV-75 Funding Gap NT but FY27 Budget Stabilizes to Army‘s Plan

sion is likely back-

end loaded given the required capability additions (search & rescue and VIP configs), suggesting a

~3-4 yr path to meaningful profitability, consistent w/ peer program ramps. Longer term, production

is targeted at ~15-20 units/yr beyond 2030, w/ competitive positioning against platforms such as

AW189, AW175 and the ~275-unit installed base of S-92s, while expanded mission capability (SAR,

head-of-state transport) should broaden the addressable market and support utilization and pricing

over time.

Aviation Incremental Margins. H1:26 Aviation margins are depressed from inefficiencies lingering

from a year ago with improvement assumed in H2 to achieve the 11-12% full-year guidance vs 10.4%

in Q1. The key to unlock 20-25% targeted incrementals is efficiency, informing investments in the

factory and supported by MSD aftermarket growth and only modestly assumed net pricing tailwinds.

There are higher volume potentials for turboprops and business jets given the demand backdrop.

Aviation workforce wages are locked in until 2029 via the union contract. The tariff environment has

stabilized, with North America now largely aligned and key facilities in Canada & Mexico remaining a

continued area of focus given cross-Everyborder supply chains. Total Aviation revs +6% to $6.3BB on

180 deliveries (vs 171 in '25) w/ margins +50 bps to 11.6%. Each 50 bps of margin = +15¢ or 2.5% to EPS.

Focus on Business Aviation Market. Business aviation demand remains strong, with limited

speculative activity (no meaningful “flipping”) and a higher-quality backlog now supported by firm

deposits. Previous supply chain constraints helped drive pricing power in recent years, but this has