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Heico (HEI) Dips More Than Broader Markets: What You Should Know

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Heico (HEI - Free Report) closed at $135.15 in the latest trading session, marking a -0.57% move from the prior day. This change lagged the S&P 500's 0.48% loss on the day. Elsewhere, the Dow lost 0.43%, while the tech-heavy Nasdaq lost 0.78%.

Prior to today's trading, shares of the defense and aerospace contractor had gained 7.38% over the past month. This has outpaced the Aerospace sector's gain of 2.15% and the S&P 500's gain of 5.97% in that time.

HEI will be looking to display strength as it nears its next earnings release. In that report, analysts expect HEI to post earnings of $0.53 per share. This would mark year-over-year growth of 8.16%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $511.23 million, up 9.75% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.22 per share and revenue of $2 billion. These totals would mark changes of +22.65% and +12.62%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for HEI. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. HEI is currently sporting a Zacks Rank of #1 (Strong Buy).

Valuation is also important, so investors should note that HEI has a Forward P/E ratio of 61.28 right now. Its industry sports an average Forward P/E of 21.68, so we one might conclude that HEI is trading at a premium comparatively.

Also, we should mention that HEI has a PEG ratio of 4.54. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Aerospace - Defense Equipment stocks are, on average, holding a PEG ratio of 2.47 based on yesterday's closing prices.

The Aerospace - Defense Equipment industry is part of the Aerospace sector. This group has a Zacks Industry Rank of 53, putting it in the top 21% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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