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Shocker.  Fundamentals Do Matter.  Momentarily.

Aerojet Rocketdyne delivered a very strong Q2 report after the close last night.  This was off the back of the stock being handed a severe drubbing in recent weeks.  (See our AJRD Q2 Earnings Preview for details).  The stock closed up 16% today - a result, it seems, of old-fashioned things like growth in backlog, revenue, earnings and cashflow.  A victory for reason over sentiment, stimulus and the various other horsemen riding to end the Enlightenment. 

Below we walk you through our take on the quarter.

Backlog Up Bigly, Stock Down Biggerly.

Aerojet Rocketdyne (AJRD) stock has taken a drubbing of late.  Down some 16% since the start of the year, despite a very strong start for the name in Q1, we confess to being rather puzzled as to this state of affairs.  The company is inexpensively valued on fundamentals, has a large and growing backlog including a recent monster NASA contract, and is geared to a number of key growth themes across space and defense.  Here we consider how Q2 numbers could play out.