Is It Time To Consider Buying TransDigm Group Incorporated (NYSE:TDG)?

Yahoo

17-05-2025

TransDigm Group Incorporated (NYSE:TDG) saw a decent share price growth of 16% on the NYSE over the last few months. The recent jump in the share price has meant that the company is trading around its 52-week high. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock's share price. But what if there is still an opportunity to buy? Let's take a look at TransDigm Group's outlook and value based on the most recent financial data to see if the opportunity still exists.
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The stock seems fairly valued at the moment according to our valuation model. It's trading around 12.93% above our intrinsic value, which means if you buy TransDigm Group today, you'd be paying a relatively reasonable price for it. And if you believe the company's true value is $1260.21, there's only an insignificant downside when the price falls to its real value. Although, there may be an opportunity to buy in the future. This is because TransDigm Group's beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
View our latest analysis for TransDigm Group
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. TransDigm Group's earnings over the next few years are expected to increase by 41%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
Are you a shareholder? It seems like the market has already priced in TDG's positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven't considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you've been keeping an eye on TDG, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it's worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
If you want to dive deeper into TransDigm Group, you'd also look into what risks it is currently facing. Case in point: We've spotted 3 warning signs for TransDigm Group you should be mindful of and 2 of these are a bit concerning.
If you are no longer interested in TransDigm Group, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.