- TransDigm has updated its full-year adjusted earnings per share (EPS) forecast to a range between $36.33 and $37.15, which is slightly below earlier estimates.
- The company anticipates net sales of $8.76 billion to $8.82 billion, refining past projections and marginally lowering the top end.
- Expected EBITDA is now between $4.70 billion to $4.76 billion, slightly improved from previous lower-end estimates.
- Third-quarter results show an adjusted EPS of $9.60, a year-over-year increase from $9, though falling short of the $9.88 estimate.
- Net sales in the third quarter reached $2.24 billion, growing 9.3% year-over-year, but below the $2.3 billion estimate.
- Third-quarter EBITDA was reported at $1.12 billion, an increase of 13% year-over-year, yet below the $1.17 billion estimate.
- Operating income improved 11% year-over-year to $1.04 billion, but still fell short of the $1.08 billion estimate.
- Pretax profit from continuing operations was recorded at $635 million, below the estimate of $676.8 million.
- Kevin Stein, TransDigm Group’s President and CEO, noted that commercial OEM market sales did not meet expectations, citing lower OEM build rates and inventory destocking as key factors.
- Despite challenges, the company achieved a robust EBITDA As Defined margin of 54.4%, marking a 110 basis point improvement from the prior year, even after accounting for headwinds from previous acquisitions.
- The midpoint of the fiscal 2025 EBITDA As Defined guidance has been raised based on strong operating performance and quarter expectations.
- Market analysts show a positive outlook with 17 buy recommendations, 5 holds, and 1 sell for TransDigm shares.
Transdigm Group on Smartkarma
Analyst coverage on Smartkarma regarding TransDigm Group by Baptista Research offers valuable insights into the company’s recent performance and growth prospects. In a report titled “TransDigm Group: An Insight Into Its Recent Aftermarket Growth, Market Dynamics & Key Growth Levers!“, TransDigm’s second-quarter fiscal 2025 earnings discussion highlighted strong operational performance driven by commercial aftermarket and defense market channels. While these divisions showed robust growth, commercial OEM revenues remained flat, indicating potential for improvement post-production disruptions.
Another report by Baptista Research, titled “TransDigm Group: The $6 Billion Aftermarket Engine and Military Advantage Investors Must Watch!“, delves into TransDigm’s Q1 2025 earnings call, outlining positive performance metrics alongside areas of concern. The analysis underscores the company’s strong financial performance for the quarter, offering investors crucial insights into TransDigm’s position in the lucrative aerospace industry and its strategic outlook for future growth.
A look at Transdigm Group Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 0 | |
| Dividend | 1 | |
| Growth | 4 | |
| Resilience | 5 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 2.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Transdigm Group, a company specializing in manufacturing aircraft components, is positioned for a promising long-term outlook based on its Smartkarma Smart Scores. With a high rating in Growth and Resilience, the company demonstrates strong potential for expanding its operations and enduring economic uncertainties. Additionally, Transdigm Group shows positive Momentum, reflecting a favorable trend in its stock performance. Although the company does not score high in the Value and Dividend categories, its overall outlook remains optimistic due to its robust Growth and Resilience scores.
Transdigm Group‘s focus on manufacturing a wide range of critical aircraft components, including ignition systems, gear pumps, and electrical motors, sets a solid foundation for its future success. The company’s strong performance in Growth, Resilience, and Momentum categories signals its ability to thrive in the competitive aviation industry and capitalize on market opportunities for long-term growth and stability.
Disclaimer: This article by Smartkarma is general in nature and 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. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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