Fact based stock research
TransDigm (NYSE:TDG)
US8936411003
How to read the free ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
TransDigm stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 25 (worse than 75% compared with investment alternatives), TransDigm (Aerospace & Defense, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of TransDigm are low in value (priced high) with a consolidated Value Rank of 23 (worse than 77% of alternatives), and are riskily financed (Safety Rank of 43, which means above-average debt burdens) but show above-average growth (Growth Rank of 53). ...read more
RECOMMENDATION: A Combined Rank of 25, is a hold recommendation based on TransDigm's financial characteristics. As the company TransDigm shows low value with an Obermatt Value Rank of 23 (77% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 53% of comparable companies (Obermatt Growth Rank is 53). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 43 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for TransDigm, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Aerospace & Defense |
| Index | D.J. US Defense, S&P 500 |
| Size class | X-Large |
This stock has achievements: Top 10 Stock.
28-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.
Review the performance ranks of the individual metrics that form each investment strategy.
Research History: TransDigm
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 37 |
|
17 |
|
20 |
|
23 |
|
| GROWTH | ||||||||
| GROWTH | 24 |
|
57 |
|
85 |
|
53 |
|
| SAFETY | ||||||||
| SAFETY | 5 |
|
53 |
|
51 |
|
43 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
60 |
|
62 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
46 |
|
74 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 25 (worse than 75% compared with investment alternatives), TransDigm (Aerospace & Defense, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of TransDigm are low in value (priced high) with a consolidated Value Rank of 23 (worse than 77% of alternatives), and are riskily financed (Safety Rank of 43, which means above-average debt burdens) but show above-average growth (Growth Rank of 53). ...read more
RECOMMENDATION: A Combined Rank of 25, is a hold recommendation based on TransDigm's financial characteristics. As the company TransDigm shows low value with an Obermatt Value Rank of 23 (77% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 53% of comparable companies (Obermatt Growth Rank is 53). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 43 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for TransDigm, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 37 |
|
17 |
|
20 |
|
23 |
|
| GROWTH | ||||||||
| GROWTH | 24 |
|
57 |
|
85 |
|
53 |
|
| SAFETY | ||||||||
| SAFETY | 5 |
|
53 |
|
51 |
|
43 |
|
| COMBINED | ||||||||
| COMBINED | 7 |
|
34 |
|
59 |
|
25 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 23 (worse than 77% compared with alternatives), TransDigm shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators where three out of four are below average for TransDigm. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 97, which means that the stock price is lower compared with invested capital than for 97% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 4 which means the stock price compared with what market professionals expect for future profits is higher than 96% of comparable companies, indicating a low value concerning TransDigm's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 97 and for the dividend yields rank which is lower than for 99% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 23, is a sell recommendation based on TransDigm's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for TransDigm, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 9 |
|
5 |
|
1 |
|
4 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 52 |
|
12 |
|
17 |
|
16 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 98 |
|
100 |
|
100 |
|
97 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 98 |
|
1 |
|
1 |
|
1 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 37 |
|
17 |
|
20 |
|
23 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 53 (better than 53% compared with alternatives), TransDigm shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for TransDigm. Sales Growth has a rank of 68 which means that currently, professionals expect the company to grow more than 68% of its competitors. Both Profit Growth, with a rank of 55, and Stock Returns, with a rank of 65, are also above average. But Capital Growth only has a rank of 25, which means that, currently, professionals expect the company to grow its invested capital less than 75% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 53, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 18 |
|
48 |
|
68 |
|
68 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 75 |
|
64 |
|
62 |
|
55 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
27 |
|
39 |
|
25 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 71 |
|
55 |
|
91 |
|
65 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 24 |
|
57 |
|
85 |
|
53 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company TransDigm has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of TransDigm is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for TransDigm. Liquidity is at 100, meaning the company generates more profit to service its debt than 100% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 23, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 77% of its competitors. Leverage is also high at a rank of 3, which means that the company has an above-average debt-to-equity ratio. It has more debt than 97% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 43 (worse than 57% compared with alternatives), TransDigm has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 8 |
|
8 |
|
5 |
|
3 |
|
| REFINANCING | ||||||||
| REFINANCING | 20 |
|
44 |
|
37 |
|
23 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 38 |
|
96 |
|
100 |
|
100 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 5 |
|
53 |
|
51 |
|
43 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
64 |
|
86 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
39 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
74 |
|
80 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
22 |
|
17 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
60 |
|
62 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for TransDigm from November 28, 2024.
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