Out of the Gate: Rockwell Collins shares slip

Shares lost $3.95, or 7.6 percent, to $47.51 and touched a two-year low of $46.83.

Before the opening bell Friday, the aerospace and defense contractor said its fiscal third-quarter profit rose 19 percent to $174 million, or $1.07 per share.

Analysts polled by Thomson Financial expected earnings of $1.02 per share.

The Cedar Rapids, Iowa, company also lifted its full-year earnings guidance to between $4.05 and $4.10 per share from between $3.95 and $4.05 per share. Wall Street expects $4.04 per share for the year.

Oppenheimer analyst Myles Walton praised the company's results, but said oil prices would continue to be a major driver of shares.

"The stock--like those of other commercial aerospace supplies--has been struggling under the weight of spiking oil prices and its expected ripple effects," Walton wrote in note investors.

On the New York Mercantile Exchange, oil prices shot to a new record near $147 a barrel in Friday morning trading.

Walton also noted the results were helped by a lower tax rate, while stronger business from the government offset weaker-than-expected commercial performance. He reiterated his "Outperform" rating on the stock.

Shares of Rockwell Collins have declined 28 percent since the start of the year.