Spirit AeroSystems: Leveraged And Risky

Atrocious fundamentals make this $6 billion+ company a compelling short.

⚡ Highlights:

• Since being carved out from Boeing, Spirit AeroSystems has proven to be a substandard business.

• Mid-term challenges suggest pressure on free cash flow. That’s a problem given a heavily leveraged balance sheet.

• The bull case has been based on industry recovery. But Spirit is showing no ability to capitalize on that recovery.

• The Q1 report seems to have broken the bull case — which suggests more downside, even near a 52-week low.