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Investing.com - UBS has reiterated its Neutral rating and $346.00 price target on HEICO (NYSE:HEI), currently trading at $327.99, following the company’s fiscal third-quarter results that exceeded analyst expectations. According to InvestingPro data, HEICO is trading at premium multiples with a P/E ratio of 70.5x, suggesting rich valuation levels.
HEICO reported revenue above consensus in both its Flight Support Group (FSG) and Electronic Technologies Group (ETG) segments, with FSG margin performance contributing to overall EBITDA results that were 5% higher than consensus estimates. The company’s strong performance is reflected in its 17.74% year-over-year revenue growth and maintains a "GOOD" financial health score on InvestingPro.
FSG organic growth reached 13%, outperforming consensus by 3% and maintaining similar growth levels to the first and second quarters despite facing tougher comparisons. The company noted growth across all sub-segments, suggesting stronger-than-expected aftermarket performance.
ETG grew organically by 7% year-over-year, exceeding consensus by 2%, with the company highlighting growth in electronics, defense, and space segments. ETG margins came in below consensus but UBS noted these figures typically fluctuate quarter to quarter.
UBS analyst Gavin Parsons suggested HEICO’s strong results, which include July performance, could help address investor concerns about a potential aftermarket slowdown that emerged following TransDigm Group’s recent results. With analyst targets ranging from $240 to $360, investors can access comprehensive valuation analysis and 12+ additional ProTips through InvestingPro’s detailed research reports.
In other recent news, HEICO Corporation reported fiscal third-quarter earnings that surpassed analyst expectations, fueled by strong aerospace aftermarket sales and robust performance in electronics and space products. The company posted earnings per share of $1.26, exceeding both KeyBanc’s estimate of $1.12 and the Street consensus of $1.14. Additionally, HEICO’s EBITDA reached $316 million, outperforming KeyBanc’s projection of $295 million. Following these results, Truist Securities reiterated its Buy rating on HEICO, maintaining a price target of $352. BofA Securities also raised its price target for HEICO to $355 from $320, citing strong aftermarket growth. Fitch Ratings upgraded HEICO Corporation’s Long-Term Issuer Default Rating to ’BBB+’ from ’BBB’, reflecting the company’s expanding cost-competitive product portfolio and predictable replacement cycles. The company also announced a 9% increase in its semiannual dividend to 12 cents per share, payable on July 15, 2025. These developments highlight HEICO’s continued strong performance and growth potential in the aerospace sector.
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