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1. Company Snapshot

1.a. Company Description

HEICO Corporation, through its subsidiaries, designs, manufactures, and sells aerospace, defense, and electronic related products and services in the United States and internationally.The company's Flight Support Group segment provides jet engine and aircraft component replacement parts; thermal insulation blankets and parts; renewable/reusable insulation systems; and specialty components.This segment also distributes hydraulic, pneumatic, structural, interconnect, mechanical, and electro-mechanical components for the commercial, regional, and general aviation markets; and offers repair and overhaul services for jet engine and aircraft component parts, avionics, instruments, composites, and flight surfaces of commercial aircraft, as well as for avionics and navigation systems, subcomponents, and other instruments utilized on military aircraft.


Its Electronic Technologies Group segment provides electro-optical infrared simulation and test equipment; electro-optical laser products; electro-optical, microwave, and other power equipment; electromagnetic and RFI shielding and suppression filters; high-speed interface products; high voltage interconnection devices; high voltage advanced power electronics; power conversion products; and underwater locator beacons and emergency locator transmission beacons.This segment also offers traveling wave tube amplifiers and microwave power modules; three-dimensional microelectronic and stacked memory products; harsh environment connectivity products and custom molded cable assemblies; radio frequency and microwave amplifiers, transmitters, and receivers; communications and electronic intercept receivers and tuners; self-sealing auxiliary fuel systems; active antenna systems; and nuclear radiation detectors.The company serves customers primarily in the aviation, defense, space, medical, telecommunications, and electronics industries.


HEICO Corporation was incorporated in 1957 and is headquartered in Hollywood, Florida.

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1.b. Last Insights on HEI

HEICO Corporation's recent performance was driven by strong Q3 fiscal 2025 results, with record net income of $177.3 million, up 30% year-over-year, and record net sales of $16% growth. The company's aerospace and electronics segments saw robust demand, fueling a 29.9% EPS jump and 15.7% revenue growth. HEICO's strategic buyouts and solid growth prospects have been cited as reasons to add the stock to an investment portfolio. The company's ROE has also been robust.

1.c. Company Highlights

2. HEICO's Q3 2025 Earnings: A Strong Performance

HEICO Corporation reported a robust third quarter 2025 financial performance, with consolidated net income increasing 30% to $177.3 million or $1.26 per diluted share, beating analyst estimates of $1.13. Consolidated operating income and net sales also reached record levels, driven by high growth rates across its subsidiaries. The company's revenue growth was fueled by strong demand from defense and commercial aerospace customers, with the Flight Support Group (FSG) and Electronic Technologies Group (ETG) achieving record-setting results.

Publication Date: Aug -29

📋 Highlights
  • Record Consolidated Net Income: Surged 30% to $177.3 million ($1.26 diluted EPS), with operating income and net sales also hitting records.
  • Flight Support Group Growth: Achieved 29% operating income increase and 18% net sales growth, alongside 13% organic expansion driven by defense and commercial aerospace demand.
  • Strong Cash Flow & Debt Reduction: Operating cash flow rose 8% to $231.2 million (130% of net income), with net debt-to-EBITDA dropping to 1.9x from 2.06x.
  • Strategic Acquisitions: Completed the fifth 2025 acquisition (Gables Engineering), incurring $1 million/month amortization but expected to drive future growth without margin dilution.
  • Avionics & Market Opportunities: Flight Support Group’s non-engine business grew 13%, while ETG aims for 22–24% operating margins, supported by PMA parts pricing 20–40% below OEM rates.

Segment Performance

The FSG segment saw 13% organic growth, driven by strong demand from defense and commercial aerospace customers. The company's defense business remains a great opportunity, and the aftermarket business is also growing, with a strong quarter for repair and overhaul. The ETG segment recovered from a weak first quarter, with net sales increasing 10%. The company's operating margins were strong, with FSG operating margins expected to sustain around 24%.

Acquisition and Integration

HEICO completed its fifth acquisition of fiscal 2025 in the third quarter, acquiring Gables Engineering, which designs and manufactures advanced solutions for aerospace platforms. The company expects Gables to be accretive to earnings within the year following the acquisition. According to Victor Mendelson, Co-CEO, "the Gables acquisition is performing in line with expectations, and we have excellent capacity for future acquisitions."

Valuation and Outlook

With a P/E Ratio of 68.44 and an EV/EBITDA ratio of 34.33, HEICO's valuation suggests that the market is pricing in a high level of growth. The company's ROE (%) is 16.57, and ROIC (%) is 10.5, indicating a strong return on equity and invested capital. Analysts estimate next year's revenue growth at 9.1%, which may be a conservative estimate given the company's strong track record of growth. HEICO's strong cash flow and decentralized purchasing approach provide a competitive advantage, and the company's focus on designer, manufacturer, and provider of repair services positions it well for future growth.

Margins and Cash Flow

HEICO's operating margins are expected to remain strong, with FSG operating margins sustain around 24%. The company's cash flow provided by operating activities increased 8% to $231.2 million, representing 130% of net income. The net debt-to-EBITDA ratio was 1.9x as of July 31, 2025, down from 2.06x as of October 31, 2024.

3. NewsRoom

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Are Aerospace Stocks Lagging Heico (HEI) This Year?

Dec -02

Source: zacks.com

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Potentially 12%-15% Consistent Income: Monthly Options Series (December 2025)

Nov -30

Source: seekingalpha.com

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Advisors Asset Management Inc. Acquires 2,219 Shares of Heico Corporation $HEI

Nov -26

Source: defenseworld.net

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Aviso Financial Inc. Purchases 407 Shares of Heico Corporation $HEI

Nov -25

Source: defenseworld.net

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End the Year Strong With These 3 Comeback Champions

Nov -19

Source: marketbeat.com

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Heico (HEI) Upgraded to Buy: Here's What You Should Know

Nov -12

Source: zacks.com

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HEICO Corporation to Acquire Storied Aviation and Defense Company

Nov -10

Source: accessnewswire.com

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Are Aerospace Stocks Lagging Heico (HEI) This Year?

Oct -21

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.90%)

6. Segments

Flight Support Group (FSG)

Expected Growth: 5.6%

None

Intersegment Sales

Expected Growth: 5.5%

HEICO's intersegment sales are driven by its proprietary products and services, strong relationships with customers, and strategic acquisitions. The company's focus on innovation and R&D investments also contributes to its growth.

Electronic Technologies Group (ETG)

Expected Growth: 6.5%

HEICO’s Electronic Technologies Group benefits from increasing demand for electronic, electrical and electro-optical equipment in aerospace, defense, and industrial markets, driven by technological advancements, growing need for surveillance and security, and rising global defense expenditures.

7. Detailed Products

Aerospace and Defense Products

HEICO Corporation's Aerospace and Defense Products segment provides a range of products and services for the aerospace, defense, and space industries.

Electronic Technologies

HEICO Corporation's Electronic Technologies segment designs and manufactures a range of electronic components and subsystems for the aerospace, defense, and industrial markets.

Aerospace and Defense Electronics

HEICO Corporation's Aerospace and Defense Electronics segment provides a range of electronic components and subsystems for the aerospace and defense industries.

Space Components and Equipment

HEICO Corporation's Space Components and Equipment segment designs and manufactures a range of components and equipment for the space industry.

Test and Simulation Solutions

HEICO Corporation's Test and Simulation Solutions segment provides a range of test and simulation solutions for the aerospace, defense, and industrial markets.

Flight Support and Technical Services

HEICO Corporation's Flight Support and Technical Services segment provides a range of technical services and support for the aerospace and defense industries.

8. HEICO Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for HEICO Corporation is medium due to the availability of alternative products and services in the aerospace and electronics industries.

Bargaining Power Of Customers

The bargaining power of customers for HEICO Corporation is low due to the company's strong relationships with its customers and the lack of buyer concentration in the industry.

Bargaining Power Of Suppliers

The bargaining power of suppliers for HEICO Corporation is medium due to the presence of multiple suppliers in the industry, but the company's dependence on a few key suppliers.

Threat Of New Entrants

The threat of new entrants for HEICO Corporation is low due to the high barriers to entry in the aerospace and electronics industries, including the need for significant capital investment and technical expertise.

Intensity Of Rivalry

The intensity of rivalry for HEICO Corporation is high due to the competitive nature of the aerospace and electronics industries, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.70%
Debt Cost 3.95%
Equity Weight 56.30%
Equity Cost 9.49%
WACC 7.07%
Leverage 77.61%

11. Quality Control: HEICO Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 5.0/10

Value: 0.5

Growth: 7.3

Quality: 7.1

Yield: 0.0

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Volatility: 7.7

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

312.2$

Current Price

312.2$

Potential

-0.00%

Expected Cash-Flows