PKE - Park Aerospace Stock Has Upside Despite Shifting Market Dynamics

2024-06-25 15:25:05 ET

Summary

• Park Aerospace has transitioned from outperforming to underperforming the markets due to margin erosion, worker inefficiencies, missed shipments and unused excess capacity.
• Modest sales growth was achieved, but margins suffered due to inventory sales, property tax expenses, and increased SG&A costs.
• Despite potential upside, Park Aerospace stock has become less attractive due to challenges in Airbus A320neo family production ramp up and inflated costs.

I’ve been covering Park Aerospace (PKE) for several quarters now, and it is one of the names I love covering, but also hate covering. The earnings calls and slide decks are lengthy, which gives us a lot of information, but there are definitely parts of the presentation that I could live without. At times, the presentation style has felt as an avalanche of complaints presenting observations from management without presenting a real risk mitigation plan....

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