HEICO (HEI) AI Stock Analysis

• Market Cap: $36.66B
• Dividend Yield: 0.07%
• Average Volume (3M): 497.47K
• Price to Earnings (P/E): 71.1
• Beta (1Y): 0.73
• Revenue Growth: 17.74%
• EPS Growth: 34.81%
• Country: US
• Employees: 10,000
• Sector: Industrials
• Sector Strength: 85
• Industry: Aerospace & Defense
• EPS (TTM): 1.12
• Shares Outstanding: 55,048,775
• 10 Day Avg. Volume: 469,651
• 30 Day Avg. Volume: 497,471
• PEG Ratio: 4.16
• Price to Book (P/B): 8.35
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 50.75
• Enterprise Value/Market Cap: 0.61
• Enterprise Value/Revenue: 1.47
• Enterprise Value/Gross Profit: 14.02
• Enterprise Value/Ebitda: 5.80
• 1Y Price Target: $303.20
• Price Target Upside: -0.36% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 79 Outperform
• Price Target: $348.00 ▲(14.36%Upside)

HEICO's overall stock score reflects its strong financial performance and positive earnings call results, indicating a well-managed company with efficient operations and strategic growth. However, the high valuation metrics and technical indicators suggest caution due to potential overvaluation and near-term price pressures.

Positive Factors

Earnings

HEICO's EPS of $1.12 exceeded expectations, driven by strong revenue and operating performance at Flight Support Group.

Financial Performance

The Flight Support segment generated $767.1mn in revenue vs. consensus of $732mn.

Growth Potential

There is potential for further customer penetration within FSG as the business continues to grow its PMA portfolio and find synergies from its prior acquisition of Wencor.

Negative Factors

Market Share

There is a long runway for growth, as its PMA revenue represents only about 2% share of the overall aftermarket components market.

Valuation

Reiterate Equal-weight rating as growth and current valuation are balanced.

HEICO Business Overview & Revenue Model

Company Description

HEICO Corporation (HEI) is a leading aerospace and electronics company that operates through two primary segments: Flight Support Group and Electronic Technologies Group. The company is renowned for designing, manufacturing, and selling aerospace, defense, and electronic products and services. Its extensive portfolio includes FAA-approved aircraft replacement parts, repair and overhaul services, as well as innovative electronic components and systems used in aviation, defense, space, medical, telecommunications, and other industries.

How the Company Makes Money

HEICO makes money through its two main business segments. The Flight Support Group generates revenue by providing aftermarket parts and repair services for commercial and military aircraft, which include FAA-approved parts and repair agreements with airlines and defense departments. The Electronic Technologies Group contributes to revenue by designing and manufacturing technologically advanced electronic components and systems used in various high-reliability applications. HEICO also benefits from strategic partnerships and long-term agreements with major aerospace and defense companies, which help secure consistent revenue streams and market position.

HEICO Financial Statement Overview

Summary

HEICO exhibits exemplary financial health with strong revenue growth, high profitability margins, a debt-free balance sheet, and efficient cash flow generation, positioning it well for continued success.

Income Statement

HEICO demonstrates strong financial performance with a consistently high gross profit margin of 55.42% and a solid net profit margin of 14.21% in the TTM (Trailing-Twelve-Months). The revenue growth rate is impressive at 3.47% from the previous year, indicating steady expansion. EBIT and EBITDA margins are robust at 21.81% and 24.02% respectively, showcasing the company's operational efficiency and profitability.

Balance Sheet

HEICO's balance sheet is strong, with a debt-to-equity ratio of 0.00, reflecting no outstanding debt and a healthy equity position. The return on equity (ROE) is commendable at 13.40%, indicating effective management in generating returns from equity. The equity ratio stands at 53.67%, highlighting a stable capital structure with more than half of the assets funded by equity.

Cash Flow

HEICO's cash flow is robust with an operating cash flow to net income ratio of 1.35, suggesting strong cash generation relative to net income. The free cash flow growth rate is 14.23%, indicating effective capital management and positive cash flow trajectory. Additionally, the free cash flow to net income ratio of 1.24 underscores efficient conversion of earnings to cash.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
3.99B	3.86B	2.97B	2.21B	1.87B	1.79B
	Gross Profit
1.59B	1.50B	1.15B	862.76M	727.42M	682.13M
	EBIT
870.87M	824.46M	625.34M	496.84M	392.90M	376.65M
	EBITDA
1.01B	1.00B	756.77M	592.71M	486.24M	465.71M
	Net Income Common Stockholders
567.37M	514.11M	403.60M	351.68M	304.22M	313.98M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
165.47M	162.10M	171.05M	139.50M	108.30M	406.85M
	Total Assets
7.89B	7.59B	7.20B	4.10B	3.50B	3.55B
	Total Debt
2.35B	2.25B	2.50B	290.27M	236.50M	739.83M
	Net Debt
2.19B	2.09B	2.33B	150.77M	128.20M	332.98M
	Total Liabilities
3.66B	3.90B	3.64B	1.12B	1.20B	1.54B
	Stockholders Equity
3.75B	3.64B	3.15B	2.65B	2.30B	2.01B
Cash Flow		Free Cash Flow
701.53M	614.11M	399.30M	435.87M	407.90M	386.19M
	Operating Cash Flow
763.75M	672.37M	448.74M	467.86M	444.08M	409.13M
	Investing Cash Flow
-511.01M	-293.20M	-2.48B	-395.83M	-183.45M	-199.04M
	Financing Cash Flow
-281.00M	-389.39M	2.07B	-33.83M	-558.97M	137.74M

HEICO Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 304.31
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HEI, the sentiment is Positive. The current price of 304.31 is above the 20-day moving average (MA) of 292.70, above the 50-day MA of 269.83, and above the 200-day MA of 257.03, indicating a bullish trend. The MACD of 10.04 indicates Positive momentum. The RSI at 69.93 is Neutral, neither overbought nor oversold. The STOCH value of 74.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HEI.

HEICO Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HEI	79 Outperform	$36.66B	71.13	16.34%	0.07%	17.74%	34.81%
LHX	76 Outperform	$48.04B	30.46	8.49%	1.87%	5.39%	36.86%
CW	74 Outperform	$17.71B	41.81	17.40%	0.18%	9.77%	15.66%
TXT	74 Outperform	$13.94B	17.49	11.70%	0.10%	0.57%	-5.62%
WWD	72 Outperform	$13.81B	37.49	16.35%	0.48%	4.96%	8.41%
MOG.A	67 Neutral	$5.73B	28.14	11.61%	0.64%	4.50%	9.90%
Sector *	66 Neutral	$4.50B	12.26	5.40%	3.65%	4.17%	-12.02%

HEICO Corporate Events

HEICO Announces Leadership Transition Effective May 2025

On April 18, 2025, HEICO Corporation’s Board of Directors approved leadership transitions, effective May 1, 2025, as part of its long-standing internal succession planning. Laurans A. Mendelson will transition from Chairman and CEO to Executive Chairman, while Eric A. Mendelson and Victor H. Mendelson will become Co-Chief Executive Officers. This change aligns with the company’s strategic direction and reflects the roles the Mendelsons have played over the years. The transition is largely titular, as the Mendelsons have collaboratively managed HEICO since 1990, significantly growing the company from a struggling entity to a major player in the aerospace and defense industry with a market capitalization nearing $30 billion.