TRANSDIGM GROUP INC (TDG)
US8936411003 - Common Stock
Taking everything into account, TDG scores 6 out of 10 in our fundamental rating. TDG was compared to 66 industry peers in the Aerospace & Defense industry. TDG has an excellent profitability rating, but there are some minor concerns on its financial health. TDG has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year TDG was profitable.
TDG had a positive operating cash flow in the past year.
TDG had positive earnings in each of the past 5 years.
Each year in the past 5 years TDG had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.15%, TDG belongs to the top of the industry, outperforming 81.82% of the companies in the same industry.
The Return On Invested Capital of TDG (13.18%) is better than 93.94% of its industry peers.
TDG had an Average Return On Invested Capital over the past 3 years of 9.83%. This is above the industry average of 7.77%.
The last Return On Invested Capital (13.18%) for TDG is above the 3 year average (9.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.15% | ||
| ROE | N/A | ||
| ROIC | 13.18% |
ROA(3y)4.59%
ROA(5y)4.27%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)9.83%
ROIC(5y)9.65%
1.3 Margins
TDG has a Profit Margin of 20.51%. This is amongst the best in the industry. TDG outperforms 96.97% of its industry peers.
In the last couple of years the Profit Margin of TDG has declined.
With an excellent Operating Margin value of 46.41%, TDG belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
TDG's Operating Margin has been stable in the last couple of years.
TDG has a Gross Margin of 59.89%. This is amongst the best in the industry. TDG outperforms 93.94% of its industry peers.
TDG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.41% | ||
| PM (TTM) | 20.51% | ||
| GM | 59.89% |
OM growth 3Y7.8%
OM growth 5Y0.31%
PM growth 3Y23.85%
PM growth 5Y-4.14%
GM growth 3Y3.55%
GM growth 5Y0.32%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TDG is still creating some value.
The number of shares outstanding for TDG has been increased compared to 1 year ago.
The number of shares outstanding for TDG has been increased compared to 5 years ago.
The debt/assets ratio for TDG has been reduced compared to a year ago.
2.2 Solvency
TDG has an Altman-Z score of 2.86. This is not the best score and indicates that TDG is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of TDG (2.86) is comparable to the rest of the industry.
TDG has a debt to FCF ratio of 12.34. This is a negative value and a sign of low solvency as TDG would need 12.34 years to pay back of all of its debts.
TDG has a Debt to FCF ratio of 12.34. This is comparable to the rest of the industry: TDG outperforms 59.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 12.34 | ||
| Altman-Z | 2.86 |
ROIC/WACC1.5
WACC8.76%
2.3 Liquidity
TDG has a Current Ratio of 3.81. This indicates that TDG is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of TDG (3.81) is better than 83.33% of its industry peers.
A Quick Ratio of 2.80 indicates that TDG has no problem at all paying its short term obligations.
TDG has a better Quick ratio (2.80) than 87.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.81 | ||
| Quick Ratio | 2.8 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 38.05% over the past year.
Measured over the past years, TDG shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.70% on average per year.
Looking at the last year, TDG shows a very strong growth in Revenue. The Revenue has grown by 21.83%.
The Revenue has been growing by 11.56% on average over the past years. This is quite good.
EPS 1Y (TTM)38.05%
EPS 3Y21.35%
EPS 5Y11.7%
EPS Q2Q%24.14%
Revenue 1Y (TTM)21.83%
Revenue growth 3Y8.87%
Revenue growth 5Y11.56%
Sales Q2Q%17.32%
3.2 Future
The Earnings Per Share is expected to grow by 9.10% on average over the next years. This is quite good.
TDG is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.11% yearly.
EPS Next Y32.98%
EPS Next 2Y24.22%
EPS Next 3Y20.11%
EPS Next 5Y9.1%
Revenue Next Year21.44%
Revenue Next 2Y16.78%
Revenue Next 3Y13.42%
Revenue Next 5Y8.11%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 41.31 indicates a quite expensive valuation of TDG.
Based on the Price/Earnings ratio, TDG is valued a bit cheaper than 60.61% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.94. TDG is valued slightly more expensive when compared to this.
Based on the Price/Forward Earnings ratio of 33.34, the valuation of TDG can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as TDG.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.03, TDG is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.31 | ||
| Fwd PE | 33.34 |
4.2 Price Multiples
TDG's Enterprise Value to EBITDA is on the same level as the industry average.
TDG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. TDG is cheaper than 63.64% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 42.05 | ||
| EV/EBITDA | 25.05 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of TDG may justify a higher PE ratio.
TDG's earnings are expected to grow with 20.11% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.25
PEG (5Y)3.53
EPS Next 2Y24.22%
EPS Next 3Y20.11%
5. Dividend
5.1 Amount
TDG has a Yearly Dividend Yield of 8.43%, which is a nice return.
Compared to an average industry Dividend Yield of 1.55, TDG pays a better dividend. On top of this TDG pays more dividend than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.24, TDG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.43% |
5.2 History
The dividend of TDG decreases each year by -8.19%.
TDG has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)-8.19%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
TDG pays out 130.64% of its income as dividend. This is not a sustainable payout ratio.
DP130.64%
EPS Next 2Y24.22%
EPS Next 3Y20.11%
TRANSDIGM GROUP INC
NYSE:TDG (11/7/2024, 7:04:33 PM)
After market: 1329.39 0 (0%)1329.39
-53.21 (-3.85%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap74.59B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.43% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.31 | ||
| Fwd PE | 33.34 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.25
PEG (5Y)3.53
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.15% | ||
| ROE | N/A | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 46.41% | ||
| PM (TTM) | 20.51% | ||
| GM | 59.89% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 3.81 | ||
| Quick Ratio | 2.8 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)38.05%
EPS 3Y21.35%
EPS 5Y
EPS Q2Q%
EPS Next Y32.98%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)21.83%
Revenue growth 3Y8.87%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y