Heico Continues Growing in Third Quarter Despite Delta Variant Concerns

Narrow-moat-rated Heico posted solid third-quarter results. Although the delta variant of COVID-19 has not materially reduced sales, it has limited flight activity increases. Sales of $472 million missed FactSet consensus estimates by 3.1%, but earnings per share of $0.56 beat FactSet consensus by 2.2%. We’re decreasing our fair value estimate to $87 per share from $91 as we incorporate Morningstar’s expectation of higher corporate taxes into our model. We continue to think the shares are pricey.