Back to top

Image: Bigstock

Will Solid Segmental Sales Boost TransDigm's Q3 Earnings?

Read MoreHide Full Article

Key Takeaways

  • TransDigm's Q3 sales are expected to rise 12.2% to $2.30 billion, fueled by strength in key business segments.
  • The Power & Control unit is projected to post $1.20 billion in revenues, up 17.1% year over year.
  • Airframe segment sales are forecasted to grow 9%, driven by defense demand and travel recovery.

TransDigm Group Incorporated ((TDG - Free Report) ) is slated to report third-quarter fiscal 2025 results on Aug. 5, before market open.

TransDigm delivered a trailing four-quarter average earnings surprise of 5.13%.

The improving growth trends in commercial air travel and strong defense sales are likely to have bolstered the quarterly performance.

TDG’s Power & Control Segment to Remain Robust

Strong sales from the commercial aftermarket, backed by steadily improving commercial air travel demand and the resulting higher flight hours and utilization of aircraft, are likely to have contributed favorably to revenues from the Power & Control segment. Steadily improving U.S. Government defense spending outlays, boosting defense sales, are also likely to have benefited this unit’s top-line growth.

The Zacks Consensus Estimate for the Power & Control segment’s fiscal third-quarter revenues is pegged at $1.20 billion, indicating a 17.1% improvement from the year-ago quarter’s figure.

TDG’s Airframe Segment Likely to Report Revenue Growth

Sales from the Airframe segment are likely to have been boosted by the strong air travel growth and rising demand for this unit’s defense products, backed by solid government funding.

The Zacks Consensus Estimate for the segment’s fiscal third-quarter revenues is pegged at $1.06 billion, indicating 9% growth from the prior-year quarter’s actual.

Q3 Estimates for TDG

Strong sales expectations from both its primary segments, which constitute approximately 98% of TDG’s total revenues, are likely to have bolstered its overall quarterly revenue performance.

The Zacks Consensus Estimate for TDG’s fiscal third-quarter sales is pegged at $2.30 billion, indicating an improvement of 12.2% from the prior-year number.

A strong top line is likely to have boosted TDG’s overall margin performance, which, along with its cost reduction initiatives, is likely to have contributed favorably to its quarterly bottom line.

The Zacks Consensus Estimate for earnings is pegged at $9.78 per share, indicating an increase of 8.7% from the year-ago figure.

What the Zacks Model Unveils for TDG

Our proven model predicts an earnings beat for TransDigm this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as you will see below.

TDG’s Earnings ESP: TDG has an Earnings ESP of +0.40%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

TDG’s Zacks Rank: TDG currently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Below, we have mentioned other players from the same industry that have the right combination of elements to beat on earnings in the upcoming releases.

Axon Enterprise ((AXON - Free Report) ) is set to report second-quarter 2025 earnings on Aug. 4, 2025, after market close. It has an Earnings ESP of +0.54% and a Zacks Rank of 2 at present.

The Zacks Consensus Estimate for AXON’s earnings is pegged at $1.54 per share, indicating year-over-year growth of 28.3%. The consensus estimate for its sales is pegged at $643 million, indicating year-over-year growth of 27.6%.

CAE ((CAE - Free Report) ) is set to report its fiscal first-quarter 2026 results on Aug. 13, before market open. It has an Earnings ESP of +1.03% and a Zacks Rank of 3 at present.

The Zacks Consensus Estimate for CAE’s earnings is pegged at 15 cents per share. The consensus estimate for its sales is pegged at $810.1 million, indicating year-over-year growth of 3.4%.

CurtissWright ((CW - Free Report) ) is set to report its second-quarter results on Aug. 6, after market close. It has an Earnings ESP of +0.67% and a Zacks Rank of 2 at present.

The Zacks Consensus Estimate for CW’s earnings is pegged at $3.13 per share, indicating year-over-year growth of 17.2%. The consensus estimate for its sales is pegged at $850.5 million, indicating year-over-year growth of 8.4%.

Published in