KeyBanc starts Heico at Sector Weight, sees through-cycle tailwinds

KeyBanc analyst Michael Leshock initiated coverage of Heico (HEI) with a Sector Weight rating. Ongoing original equipment manufacturer challenges favor the Aerospace and Defense aftermarket in the near to midterm, while Heico’s idiosyncratic growth drivers offer opportunities over the long run, though the firm believes the current market valuation reflects these dynamics, the analyst tells investors in a research note. The firm believes the A&D industry’s pandemic-induced downturn drove long-term, structural changes in favor of parts manufacturer approval parts, offering Heico through-cycle tailwinds.