William Blair analyst Louie DiPalma has reiterated their bullish stance on TDG stock, giving a Buy rating today.
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Louie DiPalma has given his Buy rating due to a combination of factors including TransDigm Group’s strong margin expansion and robust aftermarket growth. The company achieved a 54% adjusted EBITDA margin, attributed to cost-saving measures and a higher proportion of aftermarket sales, which are expected to continue supporting earnings growth.
Moreover, the commercial aftermarket segment experienced an acceleration in growth, reaching 13%, and management has not observed any slowdown in bookings. Despite a slight downward adjustment in the commercial OEM outlook, the defense segment’s outlook was revised upwards. The overall strength in the aftermarket industry and the potential for earnings growth provide a positive outlook for TransDigm, justifying the Buy rating.
DiPalma covers the Technology sector, focusing on stocks such as Palantir Technologies, Motorola Solutions, and Parsons. According to TipRanks, DiPalma has an average return of -15.5% and a 54.96% success rate on recommended stocks.
In another report released today, TD Cowen also maintained a Buy rating on the stock with a $1,500.00 price target.