Shares in defense contractor Raytheon Co. slumped Thursday after the company posted lower fourth-quarter sales and its results missed Wall Street estimates.
The parent of Tucson-based Raytheon Missile Systems reported net sales of $6.24 billion in the last quarter of 2016, down 1.4 percent from the same period in 2015 and missing analysts’ estimates of $6.5 billion.
Earnings from continuing operations fell 2.5 percent to $544 million, or $1.84 per share, down a penny from fourth-quarter 2015 and also below analyst estimates.
The company also forecast 2017 sales of $24.8 billion to $25.3 billion, below analyst expectations.
Raytheon stock closed Thursday at $142.90, down $3.97 or 2.7 percent, in trading on the New York Stock Exchange. The shares are still up nearly 25 percent in the past year.
Missile Systems, the biggest of five Raytheon business units that report individual results, saw its net sales rise just 1 percent in the fourth quarter, to $1.9 billion.
Sales at the Tucson unit rose 8 percent for all of 2016, to $7.07 billion. Operating income at the missile unit also rose 1 percent in the fourth quarter, to $260 million.
Raytheon said the bump in sales was driven mainly by sales of its Paveway precision-guided bomb kits, which saw bookings of $362 million in the quarter.
Other major sales bookings for the quarter included $309 million for Tomahawk cruise missiles, $259 for the Rolling Airframe Missile and $208 million for Stinger portable air-defense missiles.
Thomas Kennedy, Raytheon’s chairman and CEO, said in prepared remarks that strong U.S. and international bookings throughout 2016 drove an increase in the company’s backlog, positioning the company for future growth.
Raytheon said its fourth-quarter adjusted earnings included a favorable pension adjustment of 26 cents per share, compared with a favorable adjustment worth 10 cents per share in fourth-quarter 2015.
The company also said it made a pretax, discretionary pension-plan contribution of $500 million in the fourth quarter.