HEICO (HEI) AI Stock Analysis

• Market Cap: $36.64B
• Dividend Yield: 0.07%
• Average Volume (3M): 484.57K
• Price to Earnings (P/E): 70.9
• Beta (1Y): 0.73
• Revenue Growth: 17.74%
• EPS Growth: 34.81%
• Country: US
• Employees: 10,000
• Sector: Industrials
• Sector Strength: 90
• Industry: Aerospace & Defense
• EPS (TTM): 1.12
• Shares Outstanding: 55,048,775
• 10 Day Avg. Volume: 591,853
• 30 Day Avg. Volume: 484,566
• PEG Ratio: 6.33
• Price to Book (P/B): 9.79
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 45.67
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: 2.26
• Enterprise Value/Gross Profit: 21.55
• Enterprise Value/Ebitda: 8.91
• 1Y Price Target: $303.20
• Price Target Upside: -0.17% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 80 Outperform
• Price Target: $345.00 ▲(13.59%Upside)

HEICO's strong financial performance and positive earnings call results are the primary strengths, supported by solid technical analysis. However, the high valuation presents a risk, potentially limiting upside potential.

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, through its subsidiaries, designs, manufactures, and sells aerospace, defense, and electronic related products and services in the United States and internationally. The company's Flight Support Group segment provides jet engine and aircraft component replacement parts; thermal insulation blankets and parts; renewable/reusable insulation systems; and specialty components. This segment also distributes hydraulic, pneumatic, structural, interconnect, mechanical, and electro-mechanical components for the commercial, regional, and general aviation markets; and offers repair and overhaul services for jet engine and aircraft component parts, avionics, instruments, composites, and flight surfaces of commercial aircraft, as well as for avionics and navigation systems, subcomponents, and other instruments utilized on military aircraft. Its Electronic Technologies Group segment provides electro-optical infrared simulation and test equipment; electro-optical laser products; electro-optical, microwave, and other power equipment; electromagnetic and RFI shielding and suppression filters; high-speed interface products; high voltage interconnection devices; high voltage advanced power electronics; power conversion products; and underwater locator beacons and emergency locator transmission beacons. This segment also offers traveling wave tube amplifiers and microwave power modules; three-dimensional microelectronic and stacked memory products; harsh environment connectivity products and custom molded cable assemblies; radio frequency and microwave amplifiers, transmitters, and receivers; communications and electronic intercept receivers and tuners; self-sealing auxiliary fuel systems; active antenna systems; and nuclear radiation detectors. The company serves customers primarily in the aviation, defense, space, medical, telecommunications, and electronics industries. HEICO Corporation was incorporated in 1957 and is headquartered in Hollywood, Florida.

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 consistent revenue growth, strong profitability margins, a debt-free balance sheet, and efficient cash flow generation. This positions it well for continued success in the Aerospace & Defense industry.

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: 303.72
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

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 303.72 is above the 20-day moving average (MA) of 284.93, above the 50-day MA of 266.17, and above the 200-day MA of 255.60, indicating a bullish trend. The MACD of 11.26 indicates Negative momentum. The RSI at 74.19 is Negative, neither overbought nor oversold. The STOCH value of 95.02 is Negative, 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	80 Outperform	$36.64B	70.91	16.34%	0.07%	17.74%	34.81%
LHX	76 Outperform	$45.67B	28.95	8.49%	1.92%	5.39%	36.86%
CW	74 Outperform	$17.06B	40.25	17.40%	0.18%	9.77%	15.66%
TXT	74 Outperform	$13.64B	17.11	11.70%	0.10%	0.57%	-5.62%
MOG.A	72 Outperform	$5.86B	28.79	11.61%	0.61%	4.50%	9.90%
WWD	72 Outperform	$13.96B	37.90	16.35%	0.45%	4.96%	8.41%
Sector *	66 Neutral	$4.50B	12.29	5.40%	248.66%	4.13%	-12.33%

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.