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TransDigm Group Inc TDG

Morningstar Rating
$1,173.41 −9.86 (0.83%)
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Company Report

TransDigm's Specialized Aerospace Parts Business Benefits From Soaring Demand

TransDigm Group operates as a holding company with a clear, consistent strategy: acquire businesses that supply proprietary and highly engineered aircraft components with high aftermarket content. TransDigm’s businesses manufacture and sell replacement parts for aircraft, like ignition systems, pumps, actuators, flight controls, and cabin equipment, among other things. Since TransDigm is the only provider of many such products, the company has significant pricing power. The firm also operates with a high degree of financial leverage to amplify operating results.

Price vs Fair Value

TDG is trading at a 17% premium.
Price
$1,173.41
Fair Value
$1,795.00
Uncertainty
Medium
1-Star Price
$8,815.00
5-Star Price
$856.00
Economic Moat
Pqt
Capital Allocation
Htfnsfsg

Bulls Say, Bears Say

Bulls

Roughly three quarters of TransDigm’s sales are sole-source, which gives it immense pricing power.

Bears

TransDigm may not be able to find appropriate acquisition targets at reasonable prices, which would limit the firm's addressable market.

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News

Trading Information

Previous Close Price
$1,183.27
Day Range
$1,167.741,189.53
52-Week Range
$686.461,207.58
Bid/Ask
$1,171.48 / $1,877.02
Market Cap
$65.25 Bil
Volume/Avg
264,603 / 213,982

Key Statistics

Price/Earnings (Normalized)
45.41
Price/Sales
9.65
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield

Company Profile

TransDigm manufactures and services a diverse set of specialized components and parts for commercial and military aircraft. The firm organizes itself in three segments: a power and control segment, airframes, and a small nonaviation segment, which serves mostly off-road vehicles and mining equipment. It operates as an acquisitive holding company that focuses its portfolio on firms that make proprietary aerospace products with substantial aftermarket demand. TransDigm regularly employs financial leverage to amplify its operating results.
Sector
Industrials
Industry
Aerospace & Defense
Stock Style Box
Large Growth
Total Number of Employees
15,500

Competitors

Valuation

Metric
TDG
PH
RTX
Price/Earnings (Normalized)
45.4122.1817.80
Price/Book Value
6.081.99
Price/Sales
9.653.511.87
Price/Cash Flow
37.1619.5320.27
Price/Earnings
TDG
PH
RTX

Financial Strength

Metric
TDG
PH
RTX
Quick Ratio
2.980.440.63
Current Ratio
4.270.901.04
Interest Coverage
2.476.763.26
Quick Ratio
TDG
PH
RTX

Profitability

Metric
TDG
PH
RTX
Return on Assets (Normalized)
7.68%10.45%4.50%
Return on Equity (Normalized)
30.63%10.45%
Return on Invested Capital (Normalized)
13.76%15.40%7.93%
Return on Assets
TDG
PH
RTX
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