TransDigm Group INC(TDG)Stock Analysis
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Rank #126 of 2,879 stocksTOP 5%
Rankings refresh quarterly once 80% of peers have filed (~45 days after quarter-end). Next update: ~Aug 14, 2026.
Revenue Growth
Profitability
Balance Sheet
Earnings Quality
Free Cash Flow
Institutional Flow
Revenue Scale
Dilution Risk
TDG Stock Analysis & AI Quality Score
AI stock analysis and institutional research for TransDigm Group INC (TDG), a Industrials sector company. 13F Pro's AI-powered ranking engine scores TDG at 75.4/100 on a 32-signal composite quality model, placing it at rank #126 of 2,879 stocks — the top 5% of the AI-ranked universe. TDG scores in the top quartile across revenue scale (85.9), profitability (83.3), balance sheet strength (83.1). Areas of concern include institutional flow (16.9), which score below median versus the broader universe. Shareholder dilution risk is elevated at 43.8/100, reflecting ongoing share issuance or stock-based compensation. Based on the latest XBRL financial filings (Q2 2026), TransDigm Group INC reports quarterly revenue of $2.5B, net income of $535.0M, an operating margin of 46.3%. Top institutional holders of TDG by reported 13-F value include Capital International Investors, Capital World Investors, BlackRock,, based on the most recent SEC filings. TDG trades on the NYSE exchange and files with the SEC under CIK 1260221. 13F Pro's AI research platform runs 10 specialized AI analysts — value, growth, momentum, macro, and activist specialists — that debate TDG daily and publish AI-generated analysis with cited SEC sources. The platform aggregates historical XBRL financial facts, 10-Q and 10-K filings, insider Form 4 transactions, and institutional 13-F holdings for TransDigm Group INC directly from SEC EDGAR. TransDigm Group INC's 13F Pro composite quality score has ranged between 8 and 83 since 2021, currently 75.4 — an improving long-term trajectory across 56 quarterly and live scoring snapshots.
What's Driving TDG's Business? Latest 10-Q Breakdown
✓ 38/38 datapoints verifiedAI-extracted from TransDigm Group INC's 10-Q filed 2026-05-05 — Q2 FY2026 (thirteen weeks ended March 28, 2026). Every figure is machine-verified against the filing text on SEC EDGAR.
TransDigm reported Q2 net sales of $2,544M (+18.3% YoY) and net income of $535M (+11.7% YoY), with EBITDA As Defined of $1,337M (52.6% margin), driven by strong defense, commercial aftermarket, and OEM demand across all segments.
Biggest Revenue Drivers
Total revenue: $2,544M+18.3% YoY
Increases in defense, commercial aftermarket and commercial OEM sales.
Increases in commercial aftermarket, defense and commercial OEM sales.
Non-aviation related business segment.
Largest Expense Items
Increase primarily driven by higher sales volume; cost of sales as percentage of net sales decreased due to application of value-driven operating strategy offset by dilutive impact of recent acquisitions.
Increase primarily due to increase in outstanding borrowings related to acquisitions and debt issuances; weighted average interest rate 6.2% vs. 6.1% prior year.
Increase due to higher net sales and acquisition integration costs, partially offset by lower non-cash stock and deferred compensation expense.
Increase from acquisitions of Simmonds, Servotronics and other businesses completed during fiscal 2026.
Margins: Gross profit margin improved to 59.4% from 59.3% YoY despite 18.3% revenue growth, reflecting application of TransDigm's three core value-driven operating strategy (profitable new business, cost structure improvements, and value-added pricing) coupled with fixed overhead leverage, though partially offset by dilutive impact from recent acquisitions.
Watch Items from the Filing
- Company incurred $2.2B acquisition of JPE and VSA in April 2026, funded with $2.0B debt issuances in February 2026 and $1.5B additional debt in April 2026, increasing total debt to $32.0B as of March 28, 2026 against stockholders' deficit of $9.4B.
- Company active in acquisition strategy with Simmonds ($757M), pending Stellant Systems ($960M) pending regulatory approval, and bolt-on acquisitions ($243M YTD), consuming significant capital and potentially diluting near-term margins.
- Interest expense increased 28% YoY to $484M in Q2 driven by higher debt levels; weighted average interest rate 6.2%, with approximately 75% of gross debt at fixed rates as of March 28, 2026.
- Strong defense sales growth (+23.3% Power & Control segment YoY) driven by government budget increases, but company notes defense business is dependent on DOW policy, government spending timing and geopolitical dynamics, creating uncertainty.
- Operating cash flow of $967M YTD supported by $2.6B in segment EBITDA As Defined, but company deployed substantial cash for acquisitions ($1.0B) and stock repurchases ($829M YTD) while carrying $31.3B long-term debt and $724M securitization borrowings.
AI-extracted and verified against SEC EDGAR filing text. Not investment advice.
Revenue
Q2 2026
$2.5B
Net Income
Q2 2026
$535.0M
Free Cash Flow
Q2 2026
$64.0M
Operating Margin
Q2 2026
46.3%
ROIC
Q2 2026
5.4%
Revenue & Net Income
Earnings Per Share
Key Financials Over Time
Export Financial Table · Pro+Revenue
+34.1% YoYNet Income
+59.8% YoYOperating Income
+42.5% YoYEPS (Diluted)
+45.6% YoYTotal Assets
+14.7% YoYTotal Debt
+51.1% YoYOp. Cash Flow
+48.2% YoY| Metric | FY 2025 | FY 2023 | FY 2022 | FY 2021 | FY 2018 | FY 2016 |
|---|---|---|---|---|---|---|
| Revenue | $8.83B +34.1% | $6.58B +21.3% | $5.43B +13.2% | $4.80B +25.9% | $3.81B +20.2% | $3.17B |
| Net Income | $2.07B +59.8% | $1.30B +49.9% | $866.0M +27.4% | $680.0M -28.9% | $957.0M +63.2% | $586.4M |
| Operating Income | $4.17B +42.5% | $2.92B +32.0% | $2.21B +31.0% | $1.69B +2.2% | $1.66B +30.5% | $1.27B |
| EPS (Diluted) | $32.08 +45.6% | $22.03 +64.4% | $13.40 +28.7% | $10.41 | — | — |
| Total Assets | $22.91B +14.7% | $19.97B +10.3% | $18.11B -6.3% | $19.32B +58.4% | $12.20B +13.7% | $10.73B |
| Total Debt | $29.41B +51.1% | $19.47B -0.3% | $19.52B -2.0% | $19.93B +57.5% | $12.65B +25.9% | $10.05B |
| Operating Cash Flow | $2.04B +48.2% | $1.38B +45.0% | $948.0M +3.8% | $913.0M -10.7% | $1.02B | — |
AI Insight: TDG Financial Trends
Operating income surged 26% year-over-year to $1,178M in Q1 2026, but negative equity and rising debt signal aggressive financial engineering masking operational gains.
• Operating income expanded from $991M (Q1 2025) to $1,178M (Q1 2026), a 19% year-over-year increase.
• Revenue grew 18% year-over-year from $2,150M (Q1 2025) to $2,543M (Q1 2026), with Q3 2025 reaching $2,437M.
• Total debt rose from $24,494M (Q1 2025) to $31,408M (Q1 2026); equity deteriorated from -$5,671M to -$9,402M.
⚠ Operating cash flow collapsed to $135M in Q1 2026 from $631M in Q2 2025—worst quarterly result in dataset.
⚠ Negative equity of -$9,402M (Q1 2026) reflects aggressive leverage; debt/EBITDA likely elevated despite strong operating performance.
AI Insight: TDG Ratio Trends
TransDigm sustains 46%+ operating margins with ROIC holding firm at 21.4% in Q1 2026, though Q4 2025 showed seasonal softness in profitability metrics.
• Operating margin stable at 46.3% in Q1 2026 vs. 45.6% in Q2 2024; ROIC averaged 21.4% over past four quarters, up from 19.7% two years ago.
• Q3 2025 hit peak ROIC of 23.5% and ROA of 10.7%, demonstrating operational leverage during strong demand periods.
⚠ Q4 2025 margin compression: OpMargin fell to 45.6%, NPM dropped to 19.5%, and ROA fell to 7.5%—steepest declines in trailing data.
⚠ Q1 2026 NPM recovered to 21.0% but remains below Q4 2024's 24.6% peak; volatility in profitability warrants monitoring.
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Available Research
13F Pro tracks comprehensive data for TransDigm Group INC including:
Top Institutional Holders of TDG
Capital International Investors
$6.4B5,494,695 shCapital World Investors
$5.4B4,666,491 shBlackRock, Inc.
$5.3B4,601,252 shVANGUARD CAPITAL MANAGEMENT LLC
$4.3B3,669,729 shCapital Research Global Investors
$3.6B3,143,509 shVANGUARD PORTFOLIO MANAGEMENT LLC
$3.0B2,573,087 shSTATE STREET CORP
$2.9B2,516,606 shPRINCIPAL FINANCIAL GROUP INC
$2.3B2,013,784 shFMR LLC
$1.6B1,358,539 shGEODE CAPITAL MANAGEMENT, LLC
$1.5B1,276,444 sh
| Fund | Value | Shares |
|---|---|---|
| Capital International Investors | $6.4B | 5,494,695 |
| Capital World Investors | $5.4B | 4,666,491 |
| BlackRock, Inc. | $5.3B | 4,601,252 |
| VANGUARD CAPITAL MANAGEMENT LLC | $4.3B | 3,669,729 |
| Capital Research Global Investors | $3.6B | 3,143,509 |
| VANGUARD PORTFOLIO MANAGEMENT LLC | $3.0B | 2,573,087 |
| STATE STREET CORP | $2.9B | 2,516,606 |
| PRINCIPAL FINANCIAL GROUP INC | $2.3B | 2,013,784 |
| FMR LLC | $1.6B | 1,358,539 |
| GEODE CAPITAL MANAGEMENT, LLC | $1.5B | 1,276,444 |
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Popular Research
Is TDG a good stock to buy?
13F Pro's AI-powered analysis of TransDigm Group INC (TDG) draws on SEC EDGAR-sourced fundamentals, institutional 13F holdings, and insider Form 4 transactions in the Industrials sector (listed on NYSE). The 32-signal AI Quality Score, current rank, and full bull/bear verdict for TDG are available on the TDG stock profile dashboard — with the same data, AI insights, ratios, and institutional activity refreshed after every 10-K, 10-Q, 13F, and Form 4 filing.
Which hedge funds own TDG?
Institutional investors are required to disclose their holdings quarterly via SEC Form 13F. 13F Pro aggregates these filings to show which hedge funds, mutual funds, and asset managers are buying or selling TDG. Combined with insider transaction data from Form 4 filings and AI-powered analysis from 10 specialized research agents, 13F Pro provides a comprehensive view of TransDigm Group INC's investment landscape.