TDG Stock Analysis — TransDigm Group
Sector: Aerospace & Defense
AI Verdict
TDG trades at 29.9x next year's earnings while analysts expect 23.8% EPS growth — that's paying a premium the numbers barely support, so the aftermarket moat needs to keep delivering to justify this price.
Competitive Moat
TransDigm Group manufactures highly engineered aircraft components, many of which are sole-source or proprietary, giving it pricing power and long-term contracts with commercial and military customers. Its moat is built on FAA-certified parts and aftermarket dominance, which create high switching costs and recurring revenue streams.
Summary
TDG stands out for its dominance in proprietary aircraft parts, locking in aftermarket sales and margins.
Where It Stands
TDG is down -19.92% over the past year, trades at 29.9x forward earnings versus the industrials median of 20x, and its RSI of 38.2 signals shares are cooling after a selloff.
Key Metrics
- RSI: 38.2 — Near Oversold
- Trailing P/E: 37.0x
- Forward P/E: 29.9x
- PEG Ratio: 1.50
- Earnings Growth: +0.2%
- Revenue Growth: +0.1%
- Market Cap: $65.0B
- 1-Year Return: -19.92%
- 52-Week High: $1623.83
- 52-Week Low: $1123.61
Analyst Consensus
17 Buy · 10 Hold · 1 Sell (28 analysts)
Bull Case
With analysts forecasting 23.8% EPS growth next year, TDG's 29.9x forward P/E is a fair price for a business with entrenched aftermarket revenues.
Bear Case
If the P/E compresses to the sector median of 20x, the stock could see a further 33% downside from here.
Catalyst to Watch
Watch for upcoming earnings to confirm whether EPS growth stays near the 23.8% consensus, as any miss could accelerate multiple compression.