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CPI Aerostructures

CVU
35
Aerospace & Defense · Industrials
Price
$4.43
-0.19 (-4.11%)
Market Cap
$58.5M
Exchange
New York Stock Exchange American
Winston Score
35
Winston is serious
Below-average fundamentals — multiple weak pillars.

Share count rising — dilution

+5.1% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 12.2M (2021) → 12.8M (2025)

CPI Aerostructures makes structural parts for military and commercial aircraft. This includes wing assemblies, fuselage panels, and other large airframe components. Its main customers are the U.S. military and defense contractors like Northrop Grumman and L3 Technologies, making government contracts the backbone of its business.

The company earns revenue by fulfilling long-term government and commercial contracts, typically spanning multiple years. CPI Aero operates almost entirely in the United States and is a small-cap company with a market cap around $100 million, which limits its scale compared to larger aerospace suppliers. Its main competitive advantage is its established position as a trusted subcontractor on existing military programs, but that also creates a key risk: the business is heavily dependent on a small number of contracts, so losing or failing to renew a major program could significantly hurt revenue.

Winston Score History

Score breakdown

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Quality

Gross Margin
25.8%
Modest — 25.8% gross margin
Operating Margin
10.5%
Modest — 10.5% operating margin
ROCE
3.9%
Weak — 3.9% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY
-8.0%
Shrinking sales (-8.0% YoY)
EPS YoY
-2.6%
Earnings shrinking (-2.6% YoY)

Slight earnings drop. Typical near a cyclical low.

EPS Consistency
4/8 quarters
Earnings inconsistent quarter-to-quarter

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Cash Flow

Cash Conversion
-169%
Weak — only -169% of profit becomes cash
FCF Margin
-4.2%
Burning cash (-4.2%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity
0.70
Moderate — manageable debt (0.70)
Interest Cover
2.07x
Tight — interest eats into profit (2.1x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)
31.6x
Pricey — P/E 31.6

P/E above the market average. People are paying up for expected growth.

P/E vs Forward
+17.9
GROWING
Earnings expected to grow meaningfully — cheaper on forward P/E (31.6 → 13.7)

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Dividends

Not applicable for this business.
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