Exchange Income Corp T.EIF

Alternate Symbol(s): T.EIF.DB.J | T.EIF.DB.K | T.EIF.DB.L | T.EIF.DB.M | EIFZF

Industrials Airlines

Exchange Income Corporation is a Canada-based diversified acquisition-oriented company. The Company operates through two segments: Aerospace & Aviation and Manufacturing. The Aerospace & Aviation segment is comprised of three lines of business: Essential Air Services, Aerospace, and Aircraft Sales & Leasing. Its Essential Air Services includes both fixed wing and rotary wing operations. Aerospace includes its vertically integrated aerospace offerings that provide customized and integrated special mission aircraft solutions primarily to governments across the globe. Aircraft Sales & Leasing includes aftermarket aircraft, engine and parts sales and aircraft and engine leasing, along with aircraft management services. The Manufacturing segment is comprised of three lines of business: Environmental Access Solutions, Multi-Storey Window Solutions and Precision Manufacturing & Engineering. The Company also focuses on portable hydronic (glycol-based) climate-controlled equipment.

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Post by retiredcfon Jan 24, 2024 9:07am

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Post# 35842564

RBC

January 23, 2024

Exchange Income Corporation
Connecting The Dots: EIF flash read-through – RTX and GE report Q4 results

TSX: EIF | CAD 45.74 | Outperform | Price Target CAD 65.00

Sentiment: Positive

Our take. GE and RTX reported Q4 results today, with commentary pointing to a strong outlook, a positive for Regional One in our view. The results at GE and RTX suggest that sales and service revenue at Regional One was solid in Q4, with GE noting continued services strength and strong commercial engine orders and RTX (Pratt & Whitney) highlighting strong results on the back of commercial OE and commercial aftermarket. In addition, RTX guided to Pratt & Whitney organic sales up low-double digits, off adjusted 2023 sales that were up +15%. Overall, a positive indication that results at Regional One were solid in the quarter and that growth should remain robust in 2024. EIF remains on RBC's Canadian Small Cap Conviction List, and we remain constructive on the shares at today's levels.

What happened? Raytheon and GE reported Q4 results today. See below for further details as it pertains to EIF.

RTX's Pratt & Whitney segment reported Q4 sales up +14% y/y. The increase in sales was driven by a +20% increase in commercial OE, an +18% increase in commercial aftermarket, and a +4% increase in military sales. The increase in commercial sales was primarily due to higher aftermarket volume, higher OE volume and favourable mix. Pratt & Whitney 2024 guidance is for sales up low-double digits.
GE's Aerospace segment reported Q4 organic revenues up +12% y/y led by Commercial Engines and Services.