B/E Aerospace (BEAV) reported 1st quarter earnings in Monday April 22. B/E Aerospace reported revenue of 842 million and EPS of .87 cents per share. This was an increase in EPS of 30 percent year over year, and beat analyst consensus by 19 percent. Additionally, revenue of 842 million met consensus estimates and was a 12 percent increase year over year. B/E Aerospace continued to reap the benefits of the growing demand in the commercial airplane market. Book to Bill in that segment was 1.8X and approximately 1X across all segments, showing strong demand for B/E Aerospace products and services.
Additionally, B/E Aerospace has seen continued expansion of its operating margin. In the first quarter of 2013, B/E Aerospace saw an 80 basis point expansion of the operating margin. This was a result of continued reduction of SG&A expense. Additionally, B/E Aerospace has seen double digit year over year revenue growth in all three segments with the biggest surprise coming from the higher than expected growth in the business jet segment. On the earnings news, B/E Aerospace traded up approximately 3.5 percent.
Moving forward, we continued to see strong demand in the commercial aircraft market. With the 787 being authorized to fly once again pending the implementation of the new battery design, Boeing should begin to increase production of the 787 which is a major positive for B/E Aerospace. Additionally B/E Aerospace should see continued double digit growth in revenue and EPS, and continued expansion of their operating margin. We maintain a buy rating on B/E Aerospace, with an updated price target of $65.36.