Gautam Khanna, an analyst from TD Cowen, maintained the Buy rating on Transdigm Group. The associated price target remains the same with $1,565.00.
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Gautam Khanna has given his Buy rating due to a combination of factors including Transdigm Group’s improved commercial aftermarket trends and manageable risks from acquisition reforms. The company’s stock is considered a relative value, trading at a lower multiple compared to its peers, which suggests potential for growth. The price target remains unchanged, reflecting confidence in the company’s valuation.
Transdigm Group has shown robust growth in commercial aero aftermarket sales, which have finally aligned with distributor sales results. The company anticipates continued growth in this segment and has not faced significant competition from alternative parts. Additionally, the end of de-stocking in the commercial OEM sector and new contracts are expected to provide a pricing advantage. In the defense segment, Transdigm’s business model aligns well with current acquisition reforms, and the company has a strong M&A pipeline with significant capacity for future acquisitions.
In another report released on November 14, Morgan Stanley also maintained a Buy rating on the stock with a $1,660.00 price target.