Latest news with #TransDigmGroupIncorporated
Yahoo
23-06-2025
- Business
- Yahoo
TransDigm Group Incorporated (TDG): A Bull Case Theory
We came across a bullish thesis on TransDigm Group Incorporated on FluentInQuality's Substack. In this article, we will summarize the bull's thesis on TDG. TransDigm Group Incorporated's share was trading at $1,414.48 as of 19th June. TDG's trailing and forward P/E were 47.71 and 33.44, respectively, according to Yahoo Finance. A shot of a prototype aircraft taking to the skies, the symbol of the companies innovation in aerospace & defense. TransDigm is a dominant force in the aerospace supply chain, quietly powering nearly every commercial and military aircraft through thousands of proprietary, sole-source components that are essential, certified, and irreplaceable. With ~80% of sales coming from these exclusive parts and deep FAA certification moats protecting its SKUs, TransDigm operates what amounts to an engineered monopoly. Its strength lies in the aftermarket, where around 55–60% of EBITDA is generated. These recurring, high-margin revenues are tied not to airline capital expenditures but to flight hours, ensuring long-term cash flow resilience driven by decades-long platform life cycles such as the A320, 737, and F-35. TransDigm's pricing power is unmatched—owning the intellectual property enables regular price increases, translating to EBITDA margins consistently above 45%. M&A is approached with precision: bolt-on acquisitions of companies with similar sole-source profiles, high margins, and defensible IP, executed with minimal integration friction. Financially, the company uses leverage intentionally, underpinned by predictable cash flows, high free cash conversion, and a long runway of contractual revenues. Shareholders benefit through special dividends and share repurchases, reflecting TransDigm's disciplined capital allocation. There's no reliance on trendy narratives or visibility-driven hype; instead, it's a fundamental business rooted in control, recurring revenue, and operational excellence. As aircraft age, TransDigm's relevance and profitability deepen, making it a long-term compounder. For investors seeking structural moat advantages, high-visibility cash flow, and capital efficiency built into global aviation's core, TransDigm offers a compelling, resilient investment—quietly owning the skies without ever needing the spotlight. Previously, we covered a on TransDigm Group Incorporated (TDG) by Summit Stocks on Substack in May 2025, which highlighted its dominant aftermarket model, pricing power, and disciplined execution. The company's stock price has appreciated by approximately 0.66% since our coverage. FluentInQuality shares a similar view but emphasizes TransDigm's engineered monopoly and aftermarket-driven cash flow strength. TransDigm Group Incorporated is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 78 hedge fund portfolios held TDG at the end of the first quarter, which was 69 in the previous quarter. While we acknowledge the risk and potential of TDG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-05-2025
- Business
- Yahoo
Servotronics Deal Rewrite Ignites Shareholder Value
Servotronics, Inc. (NYSE:SVT) announced that the company, along with TransDigm Group Incorporated (NYSE:TDG), has made adjustments to the Agreement and Plan of Merger, raising the tender offer price to $47 per share from $38 per share in cash for all outstanding shares. This decision was taken soon after the company received an unsolicited takeover proposal from a third party. While the external offer is not the one that can be prioritized, it signals enhanced shareholder value. A close-up of a scientist's hands manipulating a high-powered microscope to view cells. The servo-control components provider, encompassing manufacturing capabilities for aircraft, jet engines, and missiles, signifies a specialized acquisition prey in the aerospace supply chain. Although the transaction still faces the regulatory approval process and closing conditions, among other challenges, the acquisition perfectly syncs with TransDigm's portfolio expansion plans. This is a major factor in the current stock movement, with investors reacting positively to this update, translating to a stock rise. Now that the news is out, investors are staying tuned for the next move, hoping the tender offer delivers even more attractive returns. SVT has surged by nearly 328% since the start of 2025. While we acknowledge the potential of SVT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than SVT and that has 100x upside potential, check out our report about the READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure. None.
Yahoo
21-05-2025
- Business
- Yahoo
TransDigm Group's (NYSE:TDG) investors will be pleased with their splendid 299% return over the last five years
The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But on the bright side, if you buy shares in a high quality company at the right price, you can gain well over 100%. For instance, the price of TransDigm Group Incorporated (NYSE:TDG) stock is up an impressive 255% over the last five years. So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. During five years of share price growth, TransDigm Group achieved compound earnings per share (EPS) growth of 19% per year. This EPS growth is slower than the share price growth of 29% per year, over the same period. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth. This optimism is visible in its fairly high P/E ratio of 46.68. You can see below how EPS has changed over time (discover the exact values by clicking on the image). We know that TransDigm Group has improved its bottom line lately, but is it going to grow revenue? Check if analysts think TransDigm Group will grow revenue in the future. When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, TransDigm Group's TSR for the last 5 years was 299%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments! TransDigm Group's TSR for the year was broadly in line with the market average, at 13%. We should note here that the five-year TSR is more impressive, at 32% per year. Although the share price growth has slowed, the longer term story points to a business well worth watching. It's always interesting to track share price performance over the longer term. But to understand TransDigm Group better, we need to consider many other factors. For example, we've discovered 3 warning signs for TransDigm Group (2 make us uncomfortable!) that you should be aware of before investing here. Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
20-05-2025
- Business
- Yahoo
TransDigm Group Incorporated (TDG) to Acquire Servotronics, Inc. (SVT) in Newly Announced Merger Deal
TransDigm Group Incorporated (NYSE:TDG) and Servotronics, Inc. (NYSEAmerican:SVT) have announced a definitive agreement under which Servotronics will become an indirect wholly owned subsidiary of TransDigm. TransDigm Group Incorporated (NYSE:TDG) is mainly known for designing and supplying a broad range of specialized aerospace components used in nearly all commercial and military aircraft. The company plans to acquire all outstanding shares of Servotronics through a tender offer of $38.50 per share in cash. This offer values the deal at around $110 million, including certain tax benefits, and represents a premium of roughly 274% over Servotronics' closing share price on May 16, 2025. Once the tender offer is completed, TransDigm Group Incorporated (NYSE:TDG) intends to finalize the acquisition through a merger at the same price for any remaining shares. The transaction will be financed using TransDigm's existing cash reserves and does not depend on external financing. Servotronics, Inc. (NYSEAmerican:SVT)'s Board of Directors has unanimously approved the deal. This acquisition aligns with TransDigm Group Incorporated (NYSE:TDG)'s strategy of acquiring proprietary aerospace businesses with strong aftermarket potential. Over the past few years, the Cleveland-based company has pursued this approach with acquisitions including DART Aerospace for $360 million in 2022, Calspan for $725 million and CPI's electron device division for $1.4 billion in 2023, and Raptor Scientific for $655 million in 2024. TDG has surged by nearly 15% since the start of 2025. While we acknowledge the potential of TDG to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than TDG and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: and Disclosure. None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
20-05-2025
- Business
- Yahoo
TransDigm Group Incorporated (TDG) to Acquire Servotronics, Inc. (SVT) in Newly Announced Merger Deal
TransDigm Group Incorporated (NYSE:TDG) and Servotronics, Inc. (NYSEAmerican:SVT) have announced a definitive agreement under which Servotronics will become an indirect wholly owned subsidiary of TransDigm. TransDigm Group Incorporated (NYSE:TDG) is mainly known for designing and supplying a broad range of specialized aerospace components used in nearly all commercial and military aircraft. The company plans to acquire all outstanding shares of Servotronics through a tender offer of $38.50 per share in cash. This offer values the deal at around $110 million, including certain tax benefits, and represents a premium of roughly 274% over Servotronics' closing share price on May 16, 2025. Once the tender offer is completed, TransDigm Group Incorporated (NYSE:TDG) intends to finalize the acquisition through a merger at the same price for any remaining shares. The transaction will be financed using TransDigm's existing cash reserves and does not depend on external financing. Servotronics, Inc. (NYSEAmerican:SVT)'s Board of Directors has unanimously approved the deal. This acquisition aligns with TransDigm Group Incorporated (NYSE:TDG)'s strategy of acquiring proprietary aerospace businesses with strong aftermarket potential. Over the past few years, the Cleveland-based company has pursued this approach with acquisitions including DART Aerospace for $360 million in 2022, Calspan for $725 million and CPI's electron device division for $1.4 billion in 2023, and Raptor Scientific for $655 million in 2024. TDG has surged by nearly 15% since the start of 2025. While we acknowledge the potential of TDG to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than TDG and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: and Disclosure. None.
