# Transdigm Group (TDG.US)

Canonical: https://gigainvestors.com/s/TDG

Analysis as of: 2026-10-16T07:32:16.900Z. Financial observations: FY2004–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

A wonderful business at too high a price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $1,134.24 per share; close as of 2026-10-15.

Estimated value: low $568.45 per share, central $775.63 per share, high $902.11 per share. Buy at or below the central value $775.63 per share. Valuation as of 2026-10-16T07:32:16.900Z; scenarios are not confidence intervals.

Expected annual return: 7.8% at the stated quote. About 7.8% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 2 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 2

- Years with a net loss: 0

- Operating margin variation: 0.10×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.43×

- FY2018: 0.44×

- FY2019: 0.39×

- FY2020: 0.34×

- FY2021: 0.35×

- FY2022: 0.41×

- FY2023: 0.44×

- FY2024: 0.44×

- FY2025: 0.48×

- LTM to Jun 2026: 0.46×

### moat: pass

- ROIC, median of available years: 44.2%

- ROIC, second-lowest year: 38.7%

- Typical minus recent gross margin: -3.1 pp

- Typical gross margin (annual median): 54.9%

- Recent gross margin (lower of latest and 3-year median): 58.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 2.1%

- ROIC including acquisitions, ten-year median: 8.0%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 43.6%

- FY2017: 46.3%

- FY2018: 59.0%

- FY2019: 33.8%

- FY2020: 44.7%

- FY2021: 43.0%

- FY2022: 38.7%

- FY2023: 42.5%

- FY2024: >100%

- FY2025: 47.9%

### economics: pass

- Owner earnings / net income, 5-yr: 1.09×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $8.8B

- Net income, five-year total: $8.1B

- Return on incremental invested capital: 137.7%

- Working capital / revenue, annual change: 0.6 pp

- Working capital / revenue, change between three-year averages: 3.1 pp

- Working capital / revenue, final three-year average: 39.3%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 1.15×

- FY2023: 1.10×

- FY2024: 1.09×

- FY2025: 1.07×

- LTM to Jun 2026: 1.07×

### management: pass

- Historical market-dollar context (not the management verdict): 2017 to 2025 (8 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 46.3% vs 47.9%

- Per-share earnings: 7.87 to 29.65 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.2%

- Ordinary dilution, 5-year annual growth: 0.3%

- Market cap gain: $62B

- Cumulative retained earnings: -$7.4B

- Diluted shares, 10-year annual growth: 0.2%

- Diluted shares, 5-year annual growth: 0.3%

- $1 test, starting fiscal year: FY2017

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 18.0%

- Per-share value change: $21.78

- Per-share value, starting three-year median: $7.87

- Per-share value, ending three-year median: $29.65

- Buybacks concentrated in cheaper years (correlation): 0.60

- Average buyback yield: 1.4%

- Buyback history: 6 years

- Debt-funded buybacks: Yes

- Acquisition spending: $7.9B

- Cumulative net income, 10 years: $10B

- ROIC, first three-year median: 46.3%

- ROIC, last three-year median: 47.9%

Chart: Earnings per share; fiscal year observations.

- FY2016: $10.32

- FY2017: $7.87

- FY2018: $16.12

- FY2019: $13.57

- FY2020: $12.20

- FY2021: $11.64

- FY2022: $14.88

- FY2023: $22.69

- FY2024: $29.65

- FY2025: $35.64

### accounting: pass

- Sloan accruals: 0.2%

- Receivables to sales index (DSRI): 1.05×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 7.7%

- Earnings backed by cash: Yes

- Operating cash / earnings: 0.98×

- Accounting red flags: 0

Chart: Sloan accruals; fiscal year observations.

- FY2016: -0.8%

- FY2017: -3.5%

- FY2018: -0.9%

- FY2019: -1.5%

- FY2020: -2.8%

- FY2021: -1.2%

- FY2022: -0.5%

- FY2023: -0.4%

- FY2024: -1.3%

- FY2025: 0.2%

## Holders

- [Mark Massey](https://gigainvestors.com/AP): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Stephen Mandel](https://gigainvestors.com/LPC): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Bryan Lawrence](https://gigainvestors.com/OCL): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Stuart McLaughlin](https://gigainvestors.com/TFP): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [C.T. Fitzpatrick](https://gigainvestors.com/VVP): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Daniel Loeb](https://gigainvestors.com/tp): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 29% since Jul 2025 · "TransDigm Group Initiates 2026 Guidance Below View" (nasdaq.com, Nov 2025) · sales +13.3%

Story as of 2026-10-16T09:59:40.118Z; price observation 2026-10-15.

Price needs cash profits to grow 11% a year for ten years

- 2025-05-06: TransDigm tops quarterly profit estimates on strong demand for aftermarket aero parts ([ca.finance.yahoo.com](https://ca.finance.yahoo.com/news/transdigm-tops-quarterly-profit-estimates-124239239.html))

- 2025-08-05: TransDigm lowers annual revenue forecast on slowing OEM business ([ca.finance.yahoo.com](https://ca.finance.yahoo.com/news/transdigm-lowers-annual-revenue-forecast-123905285.html))

- 2025-11-12: TransDigm Offers Weak Fiscal 2026 Earnings Outlook; Fourth-Quarter Results Top Views ([finance.yahoo.com](https://finance.yahoo.com/news/transdigm-offers-weak-fiscal-2026-161510286.html))

### Sales · FY2025–2026

sales +13.3%; source https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm; observed 2025-11-12.

- FY2017: $3.5B 

- FY2018: $3.8B 

- FY2019: $5.2B 

- FY2020: $5.1B 

- FY2021: $4.8B 

- FY2022: $5.4B 

- FY2023: $6.6B 

- FY2024: $7.9B 

- FY2025: $8.8B 

- FY2026: $10B 

### Gross margin · FY2025

gross margin 58%; source https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm; observed 2025-11-12.

- FY2016: 52.3% 

- FY2017: 54.2% 

- FY2018: 55.6% 

- FY2019: 51.4% 

- FY2020: 51.9% 

- FY2021: 52.4% 

- FY2022: 57.1% 

- FY2023: 58.3% 

- FY2024: 58.8% 

- FY2025: 58.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in aerospace & defense; annual sales are USD 8.8 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm (filed 2025-11-12); FY2025: revenue 8832000000; grossProfit 5121000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TDG.US: TransDigm Group Incorporated designs, produces, and supplies aircraft components in the United States and internationally. The Power & Control segment offers mechanical/electro-mechanical actuators and controls, ignition systems and engine technology, specialized pumps and valves, power conditioning devices, specialized AC/DC electric motors and generators, batteries and chargers, databus and power controls, sensor products, switches and relay panels, hoists, winches and lifting devices, cargo loading and handling systems, delivery systems, and electronic components. Its Airframe segment provides engineered latching and locking devices, engineered rods, engineered connectors and elastomer sealing solutions, cockpit security components and systems, cockpit displays, lavatory components, seat belts and safety restraints, engineered and customized interior surfaces and related components, thermal protection and insulation products, lighting and control technology, parachutes, specialized flight, wind tunnel and jet engine testing services and equipment, and testing and instrumentation solutions, as well as engineered audio, radio, and antenna systems. The Non-Aviation segment offers seat belts and safety restraints; mechanical/electromechanical actuators and controls; hydraulic/electromechanical actuators and fuel valves; refueling systems; and turbine controls. It serves engine and power system and subsystem suppliers, airlines, third party maintenance suppliers, military buying agencies, and repair depots; airframe manufacturers, cabin system and subsystem suppliers, airlines, and third party maintenance suppliers; and off-road vehicle and subsystem suppliers, child restraint system suppliers, and satellite and space system suppliers, as well as manufacturers of heavy equipment. The company was formerly known as TD Holding Corporation and changed its name to TransDigm Group Incorporated in 2006. The company was founded in 1993 and is headquartered in Cleveland, Ohio.

### Why customers stay

Margins ranged from 58% to 58.8% during 2023–25; it earns 44.2% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2023: grossProfit / revenue = 58.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2024: grossProfit / revenue = 58.8%.

- Source: https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm (filed 2025-11-12); FY2025: grossProfit / revenue = 58%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); 10-year return on capital observations [[2016,0.43643294176423314],[2017,0.4630333048126207],[2018,0.5896986107985895],[2019,0.3376641091552347],[2020,0.44747732093518366],[2021,0.4298342170239688],[2022,0.3870013513442628],[2023,0.4252720660081798],[2024,1.4172807347050544],[2025,0.47853135240646755]]; median 0.44195513134970843. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years; bought back USD 500 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2016: growth capex 0; upkeep 43982000; owner earnings 661102000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2017: growth capex 0; upkeep 71013000; owner earnings 507642000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2018: growth capex 0; upkeep 73341000; owner earnings 963417000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2019: growth capex 0; upkeep 101591000; owner earnings 903158000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2020: growth capex 0; upkeep 105000000; owner earnings 877000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2021: growth capex 0; upkeep 105000000; owner earnings 828000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2022: growth capex 0; upkeep 119000000; owner earnings 1000000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2023: growth capex 0; upkeep 139000000; owner earnings 1427000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); FY2024: growth capex 0; upkeep 165000000; owner earnings 1861000000. Growth capex / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm (filed 2025-11-12); FY2025: growth capex 0; upkeep 222000000; owner earnings 2216000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); Dividend observations: [[2016,3000000],[2017,2581552000],[2018,56148000],[2019,1712219000],[2020,1928000000],[2021,73000000],[2022,1091000000],[2023,38000000],[2024,2038000000],[2025,9629000000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm (filed 2025-11-12); FY2025: cash repurchases 500000000 USD.

### Are managers owners

Insiders own 0.4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TDG.US SharesStats.PercentInsiders = 0.409 percentage points; cache date 2026-10-16.

### What could break it

"We may rely heavily on certain customers for much of our sales." (SEC filing, Nov 2025)

- Source: https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm (filed 2025-11-12); We may rely heavily on certain customers for much of our sales.

### What the price says

The price assumes cash profits grow 11% yearly over ten years; actual growth was 16.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2025-11-12); Ten-year compound average after fade. Initial solved rate 0.14529023552556375. Price 1134.24; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 8.496417568875978 → FY2025 38.07560137457045. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $272.46 per share

- 2016-11: $251.43 per share

- 2016-12: $248.96 per share

- 2017-01: $216.40 per share

- 2017-02: $254.20 per share

- 2017-03: $220.16 per share

- 2017-04: $246.73 per share

- 2017-05: $268.08 per share

- 2017-06: $268.87 per share

- 2017-07: $282.14 per share

- 2017-08: $260.66 per share

- 2017-09: $255.65 per share

- 2017-10: $277.50 per share

- 2017-11: $283.79 per share

- 2017-12: $274.62 per share

- 2018-01: $316.91 per share

- 2018-02: $288.31 per share

- 2018-03: $306.94 per share

- 2018-04: $320.57 per share

- 2018-05: $334.11 per share

- 2018-06: $345.14 per share

- 2018-07: $375.54 per share

- 2018-08: $350.00 per share

- 2018-09: $372.30 per share

- 2018-10: $330.25 per share

- 2018-11: $361.67 per share

- 2018-12: $340.06 per share

- 2019-01: $391.00 per share

- 2019-02: $434.09 per share

- 2019-03: $453.99 per share

- 2019-04: $482.52 per share

- 2019-05: $440.95 per share

- 2019-06: $483.80 per share

- 2019-07: $485.44 per share

- 2019-08: $538.32 per share

- 2019-09: $520.67 per share

- 2019-10: $526.28 per share

- 2019-11: $567.10 per share

- 2019-12: $560.00 per share

- 2020-01: $643.28 per share

- 2020-02: $557.81 per share

- 2020-03: $320.19 per share

- 2020-04: $363.08 per share

- 2020-05: $424.82 per share

- 2020-06: $442.05 per share

- 2020-07: $431.58 per share

- 2020-08: $499.67 per share

- 2020-09: $475.12 per share

- 2020-10: $477.41 per share

- 2020-11: $579.19 per share

- 2020-12: $618.85 per share

- 2021-01: $553.28 per share

- 2021-02: $576.67 per share

- 2021-03: $587.92 per share

- 2021-04: $613.74 per share

- 2021-05: $648.84 per share

- 2021-06: $647.29 per share

- 2021-07: $641.09 per share

- 2021-08: $607.47 per share

- 2021-09: $624.57 per share

- 2021-10: $623.82 per share

- 2021-11: $578.05 per share

- 2021-12: $636.28 per share

- 2022-01: $616.19 per share

- 2022-02: $666.59 per share

- 2022-03: $651.54 per share

- 2022-04: $594.81 per share

- 2022-05: $605.37 per share

- 2022-06: $536.67 per share

- 2022-07: $622.34 per share

- 2022-08: $600.39 per share

- 2022-09: $524.82 per share

- 2022-10: $575.76 per share

- 2022-11: $628.50 per share

- 2022-12: $629.65 per share

- 2023-01: $717.75 per share

- 2023-02: $743.87 per share

- 2023-03: $737.05 per share

- 2023-04: $765.00 per share

- 2023-05: $773.65 per share

- 2023-06: $894.17 per share

- 2023-07: $899.72 per share

- 2023-08: $903.85 per share

- 2023-09: $843.13 per share

- 2023-10: $828.09 per share

- 2023-11: $962.87 per share

- 2023-12: $1,011.60 per share

- 2024-01: $1,092.68 per share

- 2024-02: $1,177.74 per share

- 2024-03: $1,231.60 per share

- 2024-04: $1,248.03 per share

- 2024-05: $1,343.23 per share

- 2024-06: $1,277.61 per share

- 2024-07: $1,294.22 per share

- 2024-08: $1,373.21 per share

- 2024-09: $1,427.13 per share

- 2024-10: $1,302.30 per share

- 2024-11: $1,252.97 per share

- 2024-12: $1,267.28 per share

- 2025-01: $1,353.34 per share

- 2025-02: $1,367.20 per share

- 2025-03: $1,383.29 per share

- 2025-04: $1,413.07 per share

- 2025-05: $1,468.43 per share

- 2025-06: $1,520.64 per share

- 2025-07: $1,608.46 per share

- 2025-08: $1,398.88 per share

- 2025-09: $1,318.02 per share

- 2025-10: $1,308.51 per share

- 2025-11: $1,360.17 per share

- 2025-12: $1,329.85 per share

- 2026-01: $1,427.54 per share

- 2026-02: $1,302.79 per share

- 2026-03: $1,158.96 per share

- 2026-04: $1,159.98 per share

- 2026-05: $1,258.32 per share

- 2026-06: $1,332.04 per share

- 2026-07: $1,254.38 per share

- 2026-08: $1,171.74 per share

- 2026-09: $1,082.60 per share

- 2026-10: $1,112.39 per share

## Annual estimated value (USD per share)

- FY2016: low $156.63 per share, central $203.32 per share, high $233.66 per share

- FY2017: low $127.11 per share, central $166.79 per share, high $193.56 per share

- FY2018: low $195.56 per share, central $258.44 per share, high $297.09 per share

- FY2019: low $243.42 per share, central $336.28 per share, high $390.81 per share

- FY2020: low $289.89 per share, central $379.60 per share, high $431.84 per share

- FY2021: low $265.05 per share, central $332.88 per share, high $376.39 per share

- FY2022: low $254.79 per share, central $323.11 per share, high $369.83 per share

- FY2023: low $320.98 per share, central $418.78 per share, high $480.68 per share

- FY2024: low $440.62 per share, central $571.38 per share, high $652.06 per share

- FY2025: low $482.70 per share, central $656.37 per share, high $762.39 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:38:01.949Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1260221/000126022125000081/tdg-20250930.htm); period 2025-09-30, filed 2025-11-12.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.