TDG

TransDigm Group

Fundamental data last updated:April 13, 2026

company profile

SECTOR

Industrials

industry

Aerospace & Defense

Exchange

NYSE

County of HQ

United States

Next Earnings Date

05/05/26

Business Summary

TransDigm operates as a highly specialized aerospace components supplier, focusing on proprietary, mission-critical parts that are deeply embedded in aircraft platforms. Its model typically revolves around owning niche components with limited substitutes, allowing it to exercise pricing power over long product lifecycles. Cash generation is driven by aftermarket demand, where replacement parts and maintenance cycles create recurring revenue streams tied to installed aircraft fleets. The moat is less about scale and more about certification barriers, switching costs, and regulatory complexity that make its components difficult to displace once designed into an aircraft.

VALUATION

P/E

38.9

Market Cap ($M USD)

$68,173

Forward P/E

26.3

PEG

2.1

PRICE TO SALES

7.7

PRICE TO BOOK

-

EV / EBITDA

20.7

5-Year Average P/E

DIVIDEND

Yield

-

Annual Payout

-

Payout Ratio

-

Consecutive Years of Dividend Growth

0

5-Year Dividend Growth Rate

-

Financial Health & Profitability

Earnings Per Share

$31.08

Next Year EPS Growth Estimate

$45.98

Next Year Revenue Growth Estimate

8.30%

Return on Equity (ROE)

-19.50%

Operating Margin

46.70%

Debt-to-Equity

-

Piotroski F-Score

6

Altman Z-Score

1.8

Return on Invested Capital (ROIC)

16.70%%

Current Ratio

2.8

Quick Ratio

Gainseekers Quantitative Analysis

Summary

At 38.9x earnings and 26.3x forward earnings, the market is clearly pricing TDG as a premium compounder, not a cyclical industrial. The forward compression from 38.9 to 26.3 implies a meaningful earnings inflection, supported by EPS rising from 20.7 to an estimated 31.08, but the 2.1 PEG suggests investors are still paying up for that growth. Financially, this is not a fortress balance sheet story: an Altman Z-Score of 1.8 sits in the distress zone, and a negative operating margin of -19.50% is a glaring inconsistency against a 16.70% ROIC. This is a high-expectation stock priced for execution perfection, with solvency metrics that demand respect rather than complacency.

AI Exposure / Tech Reliance

As an Aerospace & Defense company, TDG sits in a sector increasingly reliant on advanced avionics, data systems, and AI-enhanced defense platforms. The structural digitization of aerospace systems should provide embedded, long-cycle demand resilience. However, adaptation will depend on maintaining technological relevance within mission-critical components rather than speculative AI exposure.

The Bull Case

A GARP investor can make a disciplined case here based on capital efficiency and earnings acceleration. A 16.70% ROIC in an industrial business is elite-level performance, signaling real pricing power or asset-light economics beneath the surface. The Piotroski F-Score of 6 indicates acceptable fundamental stability, not distress-level deterioration, while the sharp projected EPS increase from 20.7 to 31.08 justifies the lower 26.3 forward P/E. With a 2.8 current ratio, near-term liquidity appears solid, giving the company room to execute through operational volatility; if operating margin normalizes from the current -19.50%, the earnings ramp could make today’s multiple look far more reasonable.

The Bear Case

The red flags are impossible to ignore. A Debt/Equity ratio of 46.70% combined with an Altman Z-Score of 1.8 places this company uncomfortably close to financial stress territory if credit markets tighten. The 2.1 PEG ratio indicates you are not buying growth cheaply, especially with a negative -19.50% operating margin that raises serious questions about earnings quality. At 38.9x trailing earnings and 7.7x sales, this is an expensive stock for a company showing margin compression and balance sheet leverage—if the EPS estimate of 31.08 slips, multiple contraction could be swift and violent.

Market Sentiment & Smart Money

Short Interest %

2.20%

Analyst Consensus

1.78

Average Analyst Price Target

$1,551.55

Institutional Ownership %

97.30%

1-Year Beta

0.71

Insider Buying % (6 Mo)

0.40%%

Distance to 52-Week High

74.30%%

Distance to 52-Week Low

107.40%%