Is TransDigm Group INC (TDG) undervalued or overvalued?

Our model estimates a fair value of about $1,022 against a price of $1,139.34 (Fair, -10% to fair value). It blends a 10-year DCF, sector multiples and earnings-power value and is a model estimate, not advice.

What is the X-Ray Score for TDG?

TransDigm Group INC has an X-Ray Score of 51 out of 100, built from valuation, growth, profitability, financial health and dividend lenses ranked against Industrials peers.

Where does the data for TDG come from?

Financial statements come from SEC EDGAR filings, prices from exchange price feeds, and industry betas and equity risk premium from Damodaran Online (NYU Stern).

TransDigm Group INC (TDG)

Industrials · Aerospace & Defense · US stock · S&P 500 component

$1,139.34 ▲ +5.10 (0.45%)

At close 16 Oct 2026 · USD · Volume 395,800

Compare with GD Historical data Research report SEC filings

Fair valueFair

$1,022 −10.3% to fair value

$511fair band $715–$1,328$1,533

Day's range

$1,135.72 – $1,158.04

52-week range

$1,071.25 – $1,463.03

Red flags⚠ Negative equity⚠ Dividend may be at risk

About TransDigm Group INC

TransDigm designs and makes specialised components for commercial and military aircraft, including actuators, sensors, ignition systems and cockpit parts. Many of its products are proprietary and sole-source, and they are sold to aircraft manufacturers and to airlines and operators needing replacement parts. A large share of revenue comes from the aftermarket. The company also grows by acquiring smaller aerospace businesses and funds many of those deals with borrowed money.

The company reported trailing revenue of $10.0 billion and three-year growth of 17.6% a year. Profitability figures show an operating margin of 46.0% and a return on invested capital of 18%. Its net debt to EBITDA ratio stands at 6.0 times. The dividend yield is 8.1%. Its X-Ray Score is 53 out of 100. The figures are a snapshot of reported results rather than a forecast.

Written with AI from public information and the filing figures on this page, then checked automatically for unsupported numbers. It can contain mistakes: read the company's own filings below before relying on it.

Price chart

Historical data & CSV

52-wk range $1,071.25 – $1,463.03Volume 395,800Daily, split-adjusted

Vitals

Market cap$65.4B

52-week range$1,071.25 – $1,463.03

Volume (last day)395,800

P/E (TTM)31.0

EBIT / EV yield4.8%

Free-cash-flow yield2.9%

Dividend yield8.1%

Revenue (TTM)$10.0B

Net income (TTM)$2.1B

Operating margin46.0%

Return on capital17.8%

Debt incl. leases$32.8B

Cash & securities$2.8B

Debt = borrowings plus lease liabilities. Cash & securities = cash, equivalents and short-term marketable securities (long-term securities are not counted, so net cash can be understated for companies like Apple). Net debt = debt minus cash & securities. Source: latest SEC 10-Q/10-K. EBIT / EV yield = operating profit divided by market cap plus net debt.

Fair value estimate

$1,022model spread $930 – $1,138

Fair −10.3% to fair value

Equal blend of three models: peer multiples, a fundamentals-adjusted multiple (growth, ROIC and margin) and a 10-year DCF scaled to the market's average. Earnings-power value (no growth) is a floor and not part of the blend. Model uncertainty is Medium, so the safety margin is 30%.

Price $1,139

Undervalued < $715Fair $715 – $1,328Overvalued > $1,328

10-year DCF (market-scaled)

$1,048

Peer multiples

$1,035

Earnings power floor (not blended)

$152

Fundamentals-adjusted multiple

$982

Growth the price implies

13.4%/yr

A model estimate, not a price target or recommendation. Inputs: risk-free 5.09%, equity risk premium 4.23% (Damodaran). How it works.

What this means

Weak business, fairly priced

The price sits inside our fair-value band. A high score does not guarantee a good outcome; it shifts the odds a little. Use the checklist as a prompt for your own research.

Before you invest · decision checklist

I understand how this company makes money Business quality is average or better 42 The price is not above fair value $1,022 fair value Debt looks manageable 6.0× EBITDA Revenue has been growing 17.6% a year Profits are backed by cash There are no red flags 2 raised I know what share of my savings this would be

Ticked boxes are filled in from our data; the rest are yours to answer.

The five-lens scan

Every score explained in one sentence, ranked against Industrials peers. Open a lens to see the numbers behind it.

Valuation Weak

39/100

Expensive against its sector on earnings and cash flow.

See the numbers →

EBIT / EV yield4.8%

Free-cash-flow yield2.9%

Fair value vs price0.9×

Growth Strong

85/100

Growing faster than most of its sector.

See the numbers →

Revenue growth (3y)17.6%

EPS growth (3y)33.8%

Growth consistency100%

Profitability Weak

45/100

Earns lower returns on its capital than most peers.

See the numbers →

Return on invested capital17.8%

Operating margin46.0%

Gross profitability22.3%

Financial health Weak

39/100

Balance sheet is more stretched than most peers.

See the numbers →

Piotroski F-Score6 / 9

Net debt / EBITDA6.0×

Interest coverNo interest cost

Dividends Fair

54/100

Dividend is typical for its sector.

See the numbers →

Dividend yield8.1%

Dividends vs free cash flow275%

Dividend growth106.7%

Quarterly results: last 6 quarters

+12.0%

Mar '25

+9.3%

Jun '25

+11.5%

Sep '25

+13.9%

Dec '25

+18.3%

Mar '26

+22.5%

Jun '26

Revenue against the same quarter a year earlier. Latest quarter revenue $2.7B, diluted EPS $9.39.

Compare with peers

GD General Dynamics Corp69 TXT Textron Inc65 LHX L3harris Technologies,...59 LMT Lockheed Martin Corp57

Other Aerospace & Defense companies by X-Ray Score.

Fundamentals checklist

● 7 Good · ● 5 Average · ● 4 Bad

Cash quality

Earnings backed by cashBad

Free-cash-flow yieldBad

Risk models

Altman Z''Bad

Piotroski F-ScoreAverage

Growth

EPS growth (3y)Good

Free-cash-flow growth (3y)Good

Revenue growth (3y)Good

Growth consistencyGood

Balance sheet

Current ratioGood

Net debt / EBITDABad

Interest coverGood

Valuation

Fair value vs priceAverage

EBIT / EV yieldAverage

Profitability

Return on invested capitalAverage

Operating marginGood

Gross profitabilityAverage

Each check is graded against the company's sector, not a fixed number. Checklist score 54/100.

Financials

	FY21	FY22	FY23	FY24	FY25
Revenue	$4.8B	$5.4B	$6.6B	$7.9B	$8.8B
Operating income	$1.7B	$2.2B	$2.9B	$3.5B	$4.2B
Net income	$680M	$866M	$1.3B	$1.7B	$2.1B
Operating cash flow	$913M	$948M	$1.4B	$2.0B	$2.0B
Operating margin	35.2%	40.8%	44.4%	44.5%	47.2%
Free cash flow	$808M	$829M	$1.2B	$1.9B	$1.8B
Diluted EPS	$10.41	$13.40	$22.03	$25.62	$32.08

Fiscal years, from SEC filings.

Technical summary

Daily

Bearish

5 bullish · 3 neutral · 8 bearish

Weekly

Strongly bearish

1 bullish · 1 neutral · 10 bearish

Monthly

Bearish

2 bullish · 1 neutral · 5 bearish

Moving averages (daily)

SMA 10	1,110.5	Bullish
EMA 10	1,116.0	Bullish
SMA 20	1,106.7	Bullish
EMA 20	1,114.8	Bullish
SMA 50	1,147.7	Bearish
EMA 50	1,143.9	Bearish
SMA 100	1,208.0	Bearish
EMA 100	1,180.6	Bearish
SMA 200	1,238.3	Bearish
EMA 200	1,218.1	Bearish

Oscillators (daily)

RSI (14)	56.88	Neutral
MACD (12, 26)	-4.79	Bearish
Momentum (12)	5.24	Bullish
Stochastic %K (14)	76.69	Neutral
Williams %R (14)	-23.31	Neutral
CCI (20)	279.7	Bearish

Pivot points (classic, last session)

1,108.4

1,122.0

1,130.7

Pivot

1,144.4

1,153.0

1,166.7

1,175.3

Signals describe what the chart is doing, not what to do. Moving averages: price above the average is bullish. Oscillators use the usual thresholds (RSI 30/70, Stochastic 20/80, CCI ±100, Williams %R −80/−20; MACD and momentum above zero are bullish). Weekly and monthly views use closing prices only.