-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Are The Aero Stocks Done?
Investor Perspectives
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Macro Backdrop Remains Decent • Low interest rates & high oil prices
– Support replacement demand
– New aircraft models a stimulant
• Airlines are profitable
– Industry profits near $19B in C14, per IATA
– Load factors at near 80%
2
2
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Favorable Indicators IATA Profitability Forecast Improves On Stronger Revenues
$17.3
$7.5 $6.1
$12.9
$16.4
$19.7 $18.7
$18.0
$0
$5
$10
$15
$20
$25
$30
2010A 2011A 2012A 2013A Sep-13E Dec-13E Mar-14E Jun-14E
Industry Net Income ($B)
2014 Forecast
3 3
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Large Backlog Appears Diversified • 7+ years of backlog
• Widebodies comprise 24% of the backlog
• Broad geographic diversification
4 4
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Widebody Mix Shift & New Product
5
Thru Aug Thru Aug Thru Aug
2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4
Boe ing
737 486 551 1,124 1,046 187 2,186 2,365 3,074 3,680 1,789 376 371 415 440 315
737MAX 456 2,219
747 (1) (1) 1 12 1 107 97 67 55 46 0 9 31 24 10
767 3 42 22 2 0 50 72 68 49 48 12 20 26 21 1
777 46 200 68 113 259 253 380 365 380 287 74 73 83 98 66
777X 220 286
787 (4) 13 (12) 182 18 847 857 799 916 865 0 3 46 65 69
To ta l 5 3 0 8 0 5 1 ,203 1 ,355 1 ,141 3 ,443 3 ,771 4 ,373 5 ,080 5 ,540 4 6 2 4 7 6 6 0 1 6 4 8 4 6 1
% Twin Aisle 8% 32% 7% 23% 24% 37% 37% 30% 28% 22% 19% 22% 31% 32% 32%
% Chg Y/Y 273% 52% 49% 13% 2% 10% 16% 16% (4%) 3% 26% 8%
Thru Aug Thru Aug Thru Aug
Ai rbus
A320 Family 415 1,348 739 1,162 94 2,418 3,345 3,629 4,298 1,483 400 421 455 493 306
A320neo Family 647 3,250
A330 51 85 58 69 29 358 349 306 267 230 87 87 101 108 66
A340 0 (2) 0 0 0 4 2 0 0 0 3 4 2 0 0
A350 78 (31) 27 230 (62) 583 555 582 812 750 0 0 0 0 0
A380 34 19 9 42 14 193 186 165 182 179 20 26 30 25 17
To ta l 5 7 8 1 ,419 8 3 3 1 ,503 7 2 2 3 ,556 4 ,437 4 ,682 5 ,559 5 ,892 5 1 0 5 3 8 5 8 8 6 2 6 3 8 9
% Twin Aisle 28% 5% 11% 23% (3%) 32% 25% 22% 23% 20% 22% 22% 23% 21% 21%
% Chg Y/Y 113% 146% (41%) 80% 2% 25% 6% 19% 2% 5% 15% 6%
Tota l 1 ,108 2 ,224 2 ,036 2 ,858 1 ,863 6 ,999 8 ,208 9 ,055 10 ,639 11 ,432 9 7 2 1 ,014 1 ,189 1 ,274 8 5 0
% Twin Aisle 19% 15% 8% 23% 14% 34% 30% 26% 25% 21% 20% 22% 27% 27% 27%
% Chg Y/Y 168% 101% (8%) 40% 2% 17% 10% 17% (1%) 4% 17% 7%
De l i ve r i e sBack l ogNe t O rde rs
5
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
7+ years of backlog Backlog 2014 Production Years of
31-Aug Rate/Month Backlog Production Plans/Issues
Boeing
737 4,008 40 8.4 - Move to 42/month in 2014, 47 in 2017, 52 in 2018
747 46 1.5 2.6 - Pared backed in October 2013; keyed to cargo market
767 48 0.5 8.0 - Transition to KC-46A
777 573 8.3 5.8
787 865 10 7.2
Total 5,540
Airbus
A320 4,733 45 9.6 - Hold 42/month until after Neo EIS in 2015, up to 46 by Q2:16
A330 230 10 2.1 - 787-10 is a threat
A350 750 NMF NMF - Plan 10/month four years after EIS
A380 179 2.5 6.5 - Plan 25-30/year in 2014
Total 5,892
- Current plan is flat; 777X/A350-1000 are L T threats
- Plan 12/month in '16; 14/mo. “later in decade”
6 6
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Large Backlog Appears Diversified
7 7
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
China May Still Be A Buyer China Fleet Growth China's China's China's
China Backlog Total BA Airbus Fleet Size Fleet GrowthChg # of a/c Backlog New OrdersDeliveries
Air China 51 34 17 2001 535
Air China Cargo 3 3 0 2002 585 9.3% 50
CALC 33 0 33 2003 653 11.6% 68 57
Capital Airlines 4 0 4 2004 730 11.8% 77 62
CASGC 1 0 1 2005 853 16.8% 123 261 106
China Eastern 72 42 30 2006 1,005 17.8% 152 673 204 140
China Southern Airlines 35 12 23 2007 1,148 14.2% 143 763 181 135
Hainan Airlines 11 2 9 2008 1,256 9.4% 108 859 159 118
ICBC 62 0 62 2009 1,411 12.3% 155 713 16 158
JUNEYAO AIRLINES 1 0 1 2010 1,572 11.4% 161 675 77 180
Kunming Airlines 1 1 0 2011 1,732 10.2% 160 633 69 176
Okay Airways 18 18 0 2012 1,924 11.1% 192 584 93 201
SHENZHEN AIRLINES 2 0 2 2013 2,135 11.0% 211 247 31 266
SICHUAN AIRLINES 3 0 3 2014E 2,284 7.0% 149
TIBET AIRLINES 1 0 1 2015E 2,444 7.0% 160
Xiamen Airlines 15 15 0 2016E 2,591 6.0% 147
313 127 186 2017E 2,746 6.0% 155
41% 59% 2018E 2,911 6.0% 165
% Of Total Backlog 2.7% 2.3% 3.2% 2019E 3,057 5.0% 146
2020E 3,210 5.0% 153
2016-2020 Total 765
8 8
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Softer Book To Ship Metrics Ahead • Book/Ship has averaged 1.8x since C07
• “New” products known & orders placed
• Production (Denominator) is rising
• Major replacement orders already placed
9 9
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Book/Ship Averaged 1.8x Since C07
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
3.0x
3.5x
4.0x
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Book-Bill
Airbus Boeing
10 10
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
>1 Book to Ship = Stock Performance
11 11
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Possible Froth In Airbus NB Backlog? AB/BA Backlog By Age Of Airline A320
Total % Total Family 737 % A320 % 737
Less than 5 years 337 3% 255 32 5% 1%
Less than 10 years 993 9% 643 268 14% 7%
More than 10 years 8,665 76% 3,416 2,796 72% 70%
Other 1,437 13% 419 912 9% 23%
Total 11,432 100% 4,733 4,008 100% 100%
AB/BA Backlog By Customer Type A320
Total % Total Family 737 % A320 % 737
Cargo 73 1%
Flagship 3,948 35% 1,213 796 26% 20%
LCC 2,941 26% 1,671 1,169 35% 29%
Lessor 2,006 18% 1,051 644 22% 16%
Other 1,453 13% 424 919 9% 23%
Regional 1,011 9% 374 480 8% 12%
Total 11,432 100% 4,733 4,008 100% 100%
12 12
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Boeing Backlog Is Relatively Balanced AB/BA Backlog By Region/Type A320
Total % Total Family 737 % A320 % 737 A350 787 % A350 % 787
Asia Pacific 2,742 24% 1,417 573 30% 14% 244 222 33% 26%
Cargo 67 1% 0% 0% 0% 0%
Europe 1,814 16% 776 638 16% 16% 138 136 18% 16%
Latin America 603 5% 329 186 7% 5% 40 42 5% 5%
Leasing 1,939 17% 1,008 632 21% 16% 74 153 10% 18%
MEA 1,145 10% 210 174 4% 4% 190 143 25% 17%
North America 1,737 15% 613 893 13% 22% 63 148 8% 17%
Other 1,385 12% 380 912 8% 23% 1 21 0% 2%
Total 11,432 100% 4,733 4,008 100% 100% 750 865 100% 100%
13 13
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Top 20 Customers Are 40% of Backlog Backlog as Total
Fleet Size % of Fleet Backlog
Lion Air 104 503% 523
American Airlines 628 62% 387
Emirates 229 128% 292
Southwest Airlines 677 42% 286
AIRASIA 79 334% 264
Norwegian 92 271% 249
UNITED AIRLINES 700 33% 230
Etihad Airways 103 208% 214
Qatar Airways 134 158% 212
Turkish Airlines 233 90% 210
Lufthansa 282 66% 187
INDIGO 80 230% 184
Ryanair 304 59% 180
Delta Air Lines 777 19% 147
EASYJET 226 64% 144
Qantas 124 97% 120
All Nippon Airways 185 59% 110
Singapore Airlines 104 106% 110
SPIRIT AIRLINES 58 186% 108
JETBLUE AIRWAYS 199 54% 107
4,264
Top 20 Customers = 37%
Ex-Unknown = 42%
14 14
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Higher Than Historic % Replacement Top 20 Customers Total Replace- % Replace-
Cowen Estimates Backlog ment Growth ment % Growth
Lion Air 523 3 520 1% 99%
American Airlines 387 387 0 100% 0%
Emirates 292 34 258 12% 88%
Southwest Airlines 286 165 121 58% 42%
AIRASIA 264 85 179 32% 68%
Norwegian 249 8 241 3% 97%
UNITED AIRLINES 230 200 30 87% 13%
Etihad Airways 214 0 214 0% 100%
Qatar Airways 212 33 179 16% 84%
Turkish Airlines 210 40 170 19% 81%
Lufthansa 187 187 0 100% 0%
INDIGO 184 0 184 0% 100%
Ryanair 180 60 120 33% 67%
Delta Air Lines 147 147 0 100% 0%
EASYJET 144 45 99 31% 69%
Qantas 120 40 80 33% 67%
All Nippon Airways 110 95 15 86% 14%
Singapore Airlines 110 110 0 100% 0%
SPIRIT AIRLINES 108 24 84 22% 78%
JETBLUE AIRWAYS 107 15 92 14% 86%
4264 1678 2586 39% 61%
15 15
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Rising Overcapacity Worries • Middle East capacity growth may encroach on
European carrier yields
– Profit warnings from Air France, Lufthansa
– Absence of major airline consolidation in Europe
• Potential Boeing/Airbus narrowbody rate hikes
16 16
Cowen and CompanyEquity Research September 2014
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Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Rising Overcapacity Worries – Gulf Big 3 Gulf Big Three Airline Growth Has Been Great – 20% RPK CGR Since 2006
Pass.
(MM)
RPK (MM) ASK
(MM)
Load
Factor
Pass.
Growth
RPK Growth ASK
Growth
Ch In
LF Cal Year Emirates Etihad Qatar Total Emirates Etihad Qatar Total
2006 23.3 62,260 12,024 25,766 100,051 135,997 73.6% - - - - - - -
2007 30.1 77,947 20,438 35,544 133,928 178,602 75.0% 29.4% 25.2% 70.0% 37.9% 33.9% 31.3% 1.4%
2008 37.2 94,346 26,665 44,442 165,453 209,535 79.0% 23.5% 21.0% 30.5% 25.0% 23.5% 17.3% 4.0%
2009 41.0 101,762 27,800 53,722 183,284 242,678 75.5% 10.2% 7.9% 4.3% 20.9% 10.8% 15.8% (3.4%)
2010 48.6 126,273 33,400 64,392 224,065 289,204 77.5% 18.3% 24.1% 20.1% 19.9% 22.3% 19.2% 2.0%
2011 58.3 160,446 38,700 75,546 274,692 346,120 79.4% 20.0% 27.1% 15.9% 17.3% 22.6% 19.7% 1.9%
2012 66.7 188,600 48,000 81,394 317,994 399,771 79.5% 14.4% 17.5% 24.0% 7.7% 15.8% 15.5% 0.2%
2013 74.0 215,353 55,500 87,037 357,890 451,851 79.2% 11.0% 14.2% 15.6% 6.9% 12.5% 13.0% (0.3%)
CAGR: 18.0% 19.4% 24.4% 19.0% 20.0% 18.7%
17 17
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Rising Overcapacity Worries – Gulf Big 3 Gulf Big Three RPK Growth Has Been 5X That Of Other IATA Airlines Since 2006
% Growth In RPK's
Cal Year IATA Mideast 3 % IATA Other Mideast Other Total
2006 4,180,676 100,051 2.4% 4,080,625
2007 4,515,130 133,928 3.0% 4,381,202 33.9% 7.4% 8.0%
2008 4,623,493 165,453 3.6% 4,458,040 23.5% 1.8% 2.4%
2009 4,568,669 183,284 4.0% 4,385,386 10.8% -1.6% -1.2%
2010 4,934,163 224,065 4.5% 4,710,098 22.3% 7.4% 8.0%
2011 5,245,014 274,692 5.2% 4,970,322 22.6% 5.5% 6.3%
2012 5,523,000 317,994 5.8% 5,205,006 15.8% 4.7% 5.3%
2013 5,839,000 357,890 6.1% 5,481,110 12.5% 5.3% 5.7%
2006-13 CGR
20.0% 4.3% 5.0%
2013-18 Guess 7,452,208 674,106 9.0% 6,778,102 13.5% 4.3% 5.0%
Moreover, They Have Shown Good Load Factor Discipline
% Growth In ASK’s (Available Seat Kilometers) Load Factor
Year Emirates Etihad Qatar Emirates Etihad Qatar
CY 2007 24.8% 47.8% 37.4%
CY 2008 15.6% 20.0% 19.4%
CY 2009 13.4% 5.8% 27.3% 75.8% 73.9% 75.8%
CY 2010 20.6% 19.6% 16.3% 78.1% 74.2% 78.1%
CY 2011 24.1% 13.3% 14.5% 79.9% 75.9% 80.0%
CY 2012 17.9% 19.6% 8.1% 79.7% 78.7% 79.7%
CY 2013 14.6% 16.6% 7.3% 79.4% 78.1% 79.4%
18 18
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Rising Overcapacity Worries – Gulf Big 3 Their Planned Widebody Capacity Growth Looks In Line With Their Recent Performance
Jun-14
Est. Deliveries*
Aircraft Type In Service 2015 2016 2017 2018 2019 2020 2021 2022
777/777X 201
12 12 8 4 11 13 3 5
787 13
6 6 17 11 9 19 12 2
747/A340 26
A330 79
4 0 1 0 0 0 0 0
A350 0
6 14 27 12 8 15 12 9
A380 49
16 18 15 9 10 9 10 9
Total 368 44 50 68 36 38 56 37 25
Seats Added - '000
17.5 20.1 25.0 13.3 14.4 19.9 13.7 10.1
Ending Seats -
'000 136.4
153.9 172.4 195.7 207.0 219.4 237.1 248.5 256.1
% Change
12.9% 13.0% 14.5% 6.8% 7.0% 9.1% 5.8% 4.1%
19
But Capacity Expansion May Encroach on European Carrier Yields – A Problem For Sentiment and Perhaps, Fundamentals
19
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Uncertain Product Transitions • 737 to 737Max
• A320 to A320neo
• 777 to 777X
• A330 to A330neo
20 20
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Extended Consensus Estimates • Sales decelerating as production rates plateau
• OEM price pressures (e.g. PFS) limit margin prospects
• Average EPS “beat” has dropped
• Manifests in multiple compression
21 21
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Average EPS “Beat” Has Dropped Jun Q 2012 Jun Q 2014
EPS Actual EPS Mean Surprise % EPS Actual EPS Mean Surprise %
BA $1.27 $1.11 14.4% $2.42 $2.01 20.4%
BEAV $0.69 $0.68 1.5% $1.13 $1.07 5.6%
COL $1.14 $1.15 -0.9% $1.19 $1.17 1.7%
HON $1.14 $1.12 1.8% $1.38 $1.36 1.5%
HXL $0.42 $0.39 7.7% $0.55 $0.55 0.0%
MOG.A $0.85 $0.84 1.2% $1.08 $1.04 3.8%
PCP $2.35 $2.36 -0.4% $3.32 $3.35 -0.9%
SPR $0.55 $0.52 5.8% $1.01 $0.68 48.5%
TDG $1.88 $1.70 10.6% $2.02 $1.98 2.0%
TGI $1.48 $1.28 15.6% $1.19 $1.20 -0.8%
UTX $1.62 $1.41 14.9% $1.84 $1.70 8.2%
Group Average 6.6% 8.2%
Ex-SPR Avg = 4.2%
22 22
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
Multiple Compression Has Occurred Next 12 Mon Next 12 Mon
9/15/2013 Price EPS Mean P/E 9/15/2014 Price EPS Mean P/E
BA $111.33 $7.09 15.7x $125.84 $8.46 14.9x
BEAV $72.91 $4.08 17.9x $85.30 $5.08 16.8x
COL $73.03 $4.85 15.1x $76.61 $4.95 15.5x
HON $84.05 $5.39 15.6x $94.60 $6.01 15.7x
HXL $37.85 $2.02 18.7x $39.38 $2.36 16.7x
MOG.A $54.18 $4.04 13.4x $68.97 $4.27 16.1x
PCP $232.23 $13.04 17.8x $241.27 $15.03 16.1x
SPR $24.05 $2.10 11.5x $38.99 $3.34 11.7x
TDG $143.07 $7.43 19.3x $189.58 $8.45 22.4x
TGI $74.90 $6.82 11.0x $69.59 $6.20 11.2x
UTX $108.39 $6.77 16.0x $108.09 $7.35 14.7x
Group Average 15.6x 15.6x
SPX_IDX $1,687.99 $114.55 14.7x $1,983.39 $124.86 15.9x
Premium/Discount vs. S&P 500 6.0% -1.7%
23 23
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
This Cycle Is Different… • Longer backlogs
• Product driven (replacement cycle)
• Geographically-diverse
• Attractive “macros” (interest rates; oil)
24 24
Cowen and CompanyEquity Research September 2014
-
Gautam Khanna, Senior Analyst and Managing Director
September 21-24, 2014 • Hilton Chicago, Chicago, Illinois, USA
…But investors may remain doubtful • All cycles have differences
• Higher idiosyncratic “bar” given book/ship declines
• “He said, she said” – will be judged ex post the book/ship inflection
25 25
Cowen and CompanyEquity Research September 2014
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COWEN AND COMPANY RATING DEFINITIONS
Cowen and Company Rating System effective May 25, 2013
Outperform (1): The stock is expected to achieve a total positive return of at least 15% over the next 12 months
Market Perform (2): The stock is expected to have a total return that falls between the parameters of an Outperform and Underperform over the next 12 months
Underperform (3): Stock is expected to achieve a total negative return of at least 10% over the next 12 months
Assumption: The expected total return calculation includes anticipated dividend yield
Cowen and Company Rating System until May 25, 2013
Outperform (1): Stock expected to outperform the S&P 500
Neutral (2): Stock expected to perform in line with the S&P 500
Underperform (3): Stock expected to underperform the S&P 500
26
Cowen and CompanyEquity Research September 2014
https://cowen.bluematrix.com/sellside/Disclosures.actionhttps://cowenlibrary.bluematrix.com/client/library.jsphttps://cowen.bluematrix.com/sellside/Disclosures.action
-
Assumptions: Time horizon is 12 months; S&P 500 is flat over forecast period
Cowen Securities, formerly known as Dahlman Rose & Company, Rating System until May 25, 2013
Buy – The fundamentals/valuations of the subject company are improving and the investment return is expected to be 5 to 15 percentage points higher than the general market return
Sell – The fundamentals/valuations of the subject company are deteriorating and the investment return is expected to be 5 to 15 percentage points lower than the general market return
Hold – The fundamentals/valuations of the subject company are neither improving nor deteriorating and the investment return is expected to be in line with the general market return
Cowen And Company Rating DefinitionsDistribution of Ratings/Investment Banking Services (IB) as of 06/30/14
Rating Count Ratings Distribution Count IB Services/Past 12 Months
Buy (a) 417 58.57% 94 22.54%
Hold (b) 279 39.19% 7 2.51%
Sell (c) 16 2.25% 0 0.00%
(a) Corresponds to "Outperform" rated stocks as defined in Cowen and Company, LLC's rating definitions. (b) Corresponds to "Market Perform" as defined in Cowen and Company, LLC's ratings definitions. (c) Corresponds to "Underperform"as defined in Cowen and Company, LLC's ratings definitions.
Note: "Buy", "Hold" and "Sell" are not terms that Cowen and Company, LLC uses in its ratings system and should not be construed as investment options. Rather, these ratings terms are used illustratively to comply with FINRA and NYSEregulations.
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Cowen and CompanyEquity Research September 2014
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Points Of ContactAnalyst Profiles
Cai von Rumohr, CFA
Boston
617.946.3942
Cai von Rumohr is a senior analystcovering aerospace & defense for over40 years – all at Cowen.
Gautam Khanna
Boston
617.946.3978
Gautam Khanna is a senior analystcovering aerospace & defense. He wasan analyst at Citadel, and has a BS fromGeorgetown and MBA from MIT.
Lucy Guo, CFA
Boston
617.946.3818
Lucy Guo is an associate coveringaerospace & defense. She started co-covering A&D at Bear Stearns, and is aChartered Financial Analyst.
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@CowenResearch Cowen and Company28
Cowen and CompanyEquity Research September 2014