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HEICO
(NYSE:HEI)
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Rating:74Outperform
Price Target:
$388.00
▲(10.53% Upside)
Action:Reiterated
Date:08/27/26
The score is driven primarily by strong fundamentals (growth, profitability, and free-cash-flow strength) and a very constructive earnings call with continued growth/margin outlook and improved leverage. Offsetting factors are weak near-term technical momentum and a premium valuation (high P/E with minimal dividend yield).
Positive Factors
Strong organic growth and margin expansion
Broad-based organic growth across both operating segments, combined with expanding margins, indicates durable demand and operating leverage. Continued strength in aerospace, defense, electronics and industrial markets supports management’s long-term 15%–20% net income growth objective.
Negative Factors
Supply-chain constraints limit repair growth
Persistent shortages and bottlenecks can delay repairs, constrain throughput and defer revenue even when customer demand is strong. If parts availability remains uneven, the issue could limit Flight Support growth and reduce operating leverage across the repair network.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong organic growth and margin expansion
Broad-based organic growth across both operating segments, combined with expanding margins, indicates durable demand and operating leverage. Continued strength in aerospace, defense, electronics and industrial markets supports management’s long-term 15%–20% net income growth objective.
Read all positive factors
HEICO (HEI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$38.21B
Dividend Yield0.04%
Average Volume (3M)476.04K
Price to Earnings (P/E)53.5
Beta (1Y)0.94
Revenue Growth20.69%
EPS Growth31.56%
CountryUS
Employees11,100
SectorGeneral
Sector StrengthN/A
IndustryAerospace & Defense
Share Statistics
EPS (TTM)6.08
Shares Outstanding55,241,646
10 Day Avg. Volume594,583
30 Day Avg. Volume476,035
Financial Highlights & Ratios
PEG Ratio1.88
Price to Book (P/B)10.26
Price to Sales (P/S)9.85
P/FCF Ratio51.30
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$410.90Price Target Upside17.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering12
EPS Forecast (FY)6.28
Revenue Forecast (FY)$5.38B
HEICO Business Overview & Revenue Model
Company Description
HEICO Corporation operates as a global enterprise through its various subsidiaries, specializing in the design, manufacturing, and distribution of an extensive range of products and services tailored for the aerospace, defense, and electronics ind...
How the Company Makes Money
HEICO makes money by selling highly specialized components and services that are embedded in customers’ aircraft and mission-critical systems, and by supplying the aftermarket needs required to keep those systems operating over long lifecycles.
1...
HEICO Earnings Call Summary
Earnings Call Date:Aug 25, 2026
(Q3-2026)
| Next Earnings Date:Dec 21, 2026
Earnings Call Sentiment Positive
The call conveyed a strongly positive operational and financial picture: record revenue, operating income, net income and EBITDA; robust organic growth across major segments; margin expansion; exceptional cash generation and improved leverage; active and accretive M&A with enhanced liquidity; and an increased dividend. Notable operational headwinds include supply chain constraints affecting repair volumes, elevated working capital and a one-time $70M–$75M cash outflow in Q4, plus caution around margin sustainability due to mix sensitivity and higher deal valuations. Overall, the favorable results, strong cash flow and strategic balance sheet moves materially outweigh the manageable challenges discussed.Positive Updates
Record Consolidated Financial Results
Consolidated net income rose 33% year-over-year to a record $235.4M ($1.67 diluted EPS) from $177.3M ($1.26). Consolidated operating income increased 34% to $355.2M and consolidated net sales increased 23% to $1,413.1M (from $1,147.6M). Consolidated EBITDA increased 31% to $415.2M (from $316.4M).
Negative Updates
Supply Chain and Parts Shortages Impacting Repairs
Component repair growth lagged (component repair organic growth ~5%), with management citing supply chain bottlenecks and lead-time issues that prevent shipments when single missing parts block completion. Repair volumes and top-line growth have been negatively affected in some areas.
Read all updates
Q3-2026 Updates
Positive
Negative
Record Consolidated Financial Results
Consolidated net income rose 33% year-over-year to a record $235.4M ($1.67 diluted EPS) from $177.3M ($1.26). Consolidated operating income increased 34% to $355.2M and consolidated net sales increased 23% to $1,413.1M (from $1,147.6M). Consolidated EBITDA increased 31% to $415.2M (from $316.4M).
Read all positive updates
Company Guidance
The company guided that it expects continued increased net sales for the remainder of fiscal 2026 at both the Flight Support Group and Electronic Technologies Group (Q3 consolidated net sales were a record $1,413.1M, up 23%), and reiterated that the segment GAAP margin outlook remains about 22%–24% (roughly 26%–28% EBITDA margins), while targeting long‑term net income growth of 15%–20% annually; management also highlighted robust cash generation (Q3 operating cash flow $345.3M, up 49%; Q3 EBITDA $415.2M, up 31%), improved leverage (net debt / EBITDA 1.57x), a strong backlog and organic growth (ETG organic ~18%, FSG organic ~12%), ample M&A firepower after issuing $1.2B of senior notes and amending the revolver to $2.2B (expandable to $3.0B) with acquisitions expected to be accretive within a year, continued high free‑cash conversion (~70% of EBITDA expected) and an acknowledged Q4 operating cash outflow of roughly $70M–$75M tied to a payment to an estate.HEICO Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
78
Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.18B | 4.49B | 3.86B | 2.97B | 2.21B | 1.87B |
| Gross Profit | 2.09B | 1.79B | 1.61B | 1.25B | 938.82M | 796.30M |
| EBITDA | 1.47B | 1.22B | 1.00B | 756.77M | 592.71M | 486.24M |
| Net Income | 847.72M | 690.38M | 514.11M | 403.60M | 351.68M | 304.22M |
Balance Sheet | ||||||
| Total Assets | 9.94B | 8.50B | 7.59B | 7.20B | 4.10B | 3.50B |
| Cash, Cash Equivalents and Short-Term Investments | 240.96M | 217.78M | 162.10M | 171.05M | 139.50M | 108.30M |
| Total Debt | 2.54B | 2.19B | 2.25B | 2.50B | 304.93M | 250.37M |
| Total Liabilities | 4.29B | 4.12B | 3.90B | 4.00B | 1.12B | 948.88M |
| Stockholders Equity | 4.95B | 4.31B | 3.64B | 3.15B | 2.61B | 2.26B |
Cash Flow | ||||||
| Free Cash Flow | 1.03B | 861.38M | 614.11M | 399.30M | 435.87M | 407.90M |
| Operating Cash Flow | 1.11B | 934.27M | 672.37M | 448.74M | 467.86M | 444.08M |
| Investing Cash Flow | -1.11B | -731.69M | -293.20M | -2.48B | -395.83M | -183.45M |
| Financing Cash Flow | -25.92M | -150.68M | -389.39M | 2.07B | -33.83M | -558.97M |
HEICO Technical Analysis
Negative
351.05
Price Trends
352.12
Negative
328.39
Negative
322.55
Positive
Market Momentum
-8.31
Positive
30.83
Neutral
8.43
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HEI, the sentiment is Negative. The current price of 351.05 is above the 20-day moving average (MA) of 350.62, below the 50-day MA of 352.12, and above the 200-day MA of 322.55, indicating a neutral trend. The MACD of -8.31 indicates Positive momentum. The RSI at 30.83 is Neutral, neither overbought nor oversold. The STOCH value of 8.43 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HEI.
HEICO Risk Analysis
HEICO disclosed 20 risk factors in its most recent earnings report. HEICO reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
HEICO Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $11.72B | 31.21 | 18.00% | 0.32% | 15.65% | 78.52% | |
74 Outperform | $38.21B | 53.53 | 18.30% | 0.04% | 20.69% | 31.56% | |
72 Outperform | $21.01B | 38.79 | 20.69% | 0.17% | 10.54% | 22.56% | |
67 Neutral | $20.23B | 37.43 | 21.75% | 0.36% | 22.35% | 41.77% | |
66 Neutral | $64.00B | 35.26 | -21.02% | 12.64% | 16.64% | 9.48% | |
64 Neutral | $49.11B | 67.94 | -16.21% | ― | ― | ― | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
HEI
HEICO
325.48
8.33
2.63%
CW
Curtiss-Wright
566.75
83.28
17.23%
MOG.A
Moog
371.68
178.17
92.07%
TDG
Transdigm Group
1,162.05
-131.19
-10.14%
WWD
Woodward
346.22
106.17
44.23%
HONA
Honeywell Aerospace
161.01
-38.99
-19.50%
HEICO Corporate Events
Business Operations and StrategyPrivate Placements and Financing
HEICO Raises $1.2 Billion Through Senior Notes Offering
Positive
Jul 17, 2026
On July 16, 2026, HEICO Corporation closed a $1.2 billion senior notes offering, issuing $550 million of 4.950% notes due 2031 and $650 million of 5.400% notes due 2036. The company will use the proceeds to pay down borrowings under its $2.2 billi...
Business Operations and StrategyPrivate Placements and Financing
HEICO Expands and Extends Revolving Credit Facility Agreement
Positive
Jun 17, 2026
On June 11, 2026, HEICO Corporation amended its revolving credit agreement, increasing the capacity of its existing credit facility from $2.0 billion to $2.2 billion and extending the facility’s maturity to June 11, 2031. The amendment also ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.