NYSE$TDG

Transdigm Group Incorporated · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Transdigm Group reported strong second quarter results driven by revenue growth and margin improvement.

TransDigm Group reported a strong second quarter with net sales increasing by 20% to $1,592 million and adjusted earnings per share rising by 55% to $5.98. The company also raised its full-year guidance, reflecting the strong second-quarter results and the acquisition of Calspan Corporation.

  • Net sales increased by 20% year-over-year to $1,592 million.
  • Organic sales growth was 17.6%.
  • Adjusted earnings per share increased by 55% year-over-year to $5.98.
  • EBITDA As Defined margin improved to 51.3%.

Headline financials

Total Revenue

$1.59B

Previous: $1.33B+20.0%
EPS (adj)

$5.98

Previous: $3.86+54.9%
Organic Sales Growth

17.6%

Previous: 15.1%+16.6%
Capital Expenditures

-$66M

Previous: -$57M-15.8%
Free Cash Flow

$238M

Previous: $142M+67.6%
Net Income

$304M

Previous: $199M+52.8%
Operating Income

$695M

Previous: $520M+33.7%
Gross Profit

$929M

Previous: $736M+26.2%
Cash & Equivalents

$3.42B

Previous: $4.22B-18.9%
Total Assets

$20B

Previous: $18.8B+6.2%
Stock-Based Comp

$42M

Previous: $42M+0.0%

Revenue & EPS history

Transdigm · Revenue · Quarterly

$1.59B

Q2 2023+20%vs Q2 2022
Beat estimate in 8 of 14 quarters(57%)
ActualEstimate

Forward guidance

TransDigm raised its full year guidance primarily to reflect strong second quarter results, the recent acquisition of Calspan, and current expectations for the remainder of the fiscal year.

Tailwinds

  • Net sales are anticipated to be in the range of $6,410 million to $6,500 million.
  • Net income from continuing operations is anticipated to be in the range of $1,141 million to $1,191 million.
  • Earnings per share from continuing operations is expected to be in the range of $19.30 to $20.18 per share based upon weighted average shares outstanding of 57.1 million shares.
  • EBITDA As Defined is anticipated to be in the range of $3,230 million to $3,290 million.
  • Adjusted earnings per share is expected to be in the range of $23.31 to $24.19 per share.

Headwinds

  • Commercial aftermarket revenue growth in the 25% to 30% range
  • Commercial OEM revenue growth in the 20% to 25% range
  • Defense revenue growth in the low to mid-single-digit percentage range.
  • Impact of COVID-19 pandemic on the business.
  • Sensitivity of the business to flight hours and customer profitability.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+0.5%

Avg return

Earnings day

+0.3%

Avg return

5 days after

+1.4%

Avg return

30 days after

53%

35 / 66 earnings

Positive

+16.5%

Q3 2019

Best reaction

-11.9%

Q3 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026+5.1%+5.6%+6.7%
Q1 2026-9.3%-10.4%-9.8%
Q4 2025+1.0%+3.2%+0.1%
Q3 2025-11.9%-13.6%-20.3%
Q2 2025-5.6%-6.7%-1.9%
Q1 2025-3.3%-1.9%-0.6%
Q4 2024-2.3%-2.0%-7.5%
Q3 2024-0.6%+3.0%+9.9%
Q2 2024+1.0%+0.7%+2.5%
Q1 2024-2.4%-2.2%+1.6%
Q4 2023+10.9%+11.3%+9.9%
Q3 2023-4.8%-4.5%-2.9%
Q2 2023+4.9%+3.0%+4.5%
Q1 2023+4.7%+1.4%+2.9%
Q4 2022+7.5%+6.0%+4.6%
Q3 2022+3.9%+5.5%-4.0%
Q2 2022+4.6%+3.3%+11.4%
Q1 2022+2.7%+0.8%+0.1%
Q4 2021+0.8%-3.3%-11.8%
Q3 2021-0.7%-3.6%-4.8%
Q2 2021-3.8%-0.7%+9.7%
Q1 2021-3.4%-3.9%-0.5%
Q4 2020+1.1%+3.1%+7.3%
Q3 2020+8.2%+9.0%+13.3%
Q2 2020-6.7%+3.0%+40.7%
Q1 2020-4.0%-2.7%-17.8%
Q4 2019+1.3%-0.9%+1.3%
Q3 2019+16.5%+18.1%+15.5%
Q2 2019+1.3%-0.3%-1.4%
Q1 2019+4.3%+5.7%+6.2%
Q4 2018+3.8%+3.0%+0.2%
Q3 2018-3.1%-3.2%-4.1%
Q2 2018-0.5%+0.7%+4.2%
Q1 2018-1.6%-4.8%-3.7%
Q4 2017-6.3%-5.9%-3.6%
Q3 2017-2.3%-3.5%-10.8%
Q2 2017-4.0%-4.6%+7.1%
Q1 2017+7.1%+9.6%+4.6%
Q4 2016-4.9%-8.2%-7.9%
Q3 2016+3.1%+1.5%+3.4%
Q2 2016+9.5%
Q1 2016-10.1%
Q4 2015+5.0%
Q3 2015+4.1%
Q2 2015-0.1%
Q1 2015-2.7%
Q4 2014+3.3%
Q3 2014+1.5%
Q2 2014-2.3%
Q1 2014+5.1%
Q4 2013-0.5%
Q3 2013-3.4%
Q2 2013-1.2%
Q1 2013+1.5%
Q4 2012+3.5%
Q3 2012+1.2%
Q2 2012-1.4%
Q1 2012+2.0%
Q4 2011-1.2%
Q3 2011+2.3%
Q2 2011+0.7%
Q1 2011+1.5%
Q4 2010+2.9%
Q3 2010-1.3%
Q2 2010+3.7%
Q1 2009-0.8%

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