TransDigm Group Incorporated (TDG) DCF Valuation
Why we don't show a single “fair value” for TDG
Even the optimistic scenario of a conservative trailing-FCF model ($516.10) sits far below today's price — the market is paying for growth and durability beyond what this model structure captures. The honest lens is the question below: what growth does today's price actually require? The model scenarios are listed further down for reference.
What would today's price require?
$1,328.31 is justified only if free cash flow grows about +37.5% a year (fading to 2.5% long-run) at a 8.6% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 10.9%/yr | 9.6% | $68.58 |
| Base case | 13.9%/yr | 8.6% | $248.18 |
| Optimistic | 16.9%/yr | 7.6% | $516.10 |
| Analyst DCF (FMP) | independent reference — different model | $2,293.26 | |
Current Price
$1,328.31
Market-Implied Growth
+37.5%/yr
vs +13.7% 5Y actual
Base-Case Model Value
$248.18
model output — not a price target
TDG DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for TDG (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $1.5B · 0.06B shares · net debt $27.2B
Estimated Fair Value
$609.75
-54.1% vs $1328.31
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 13.9%/yr FCF growth and 10-year horizon fixed. Green = above today's $1328.31; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 6.6% | $966 | $1087 | $1236 | $1427 | $1680 |
| 7.6% | $694 | $769 | $860 | $971 | $1108 |
| 8.6% | $500 | $550 | $610 | $680 | $763 |
| 9.6% | $355 | $391 | $432 | $478 | $533 |
| 10.6% | $244 | $270 | $299 | $332 | $369 |
About TransDigm Group Incorporated
TransDigm Group Incorporated is a global aerospace enterprise specializing in the development, manufacturing, and distribution of a wide array of aircraft components. Operating across the United States and internationally, its business is structured around three distinct divisions. The Power & Control division focuses on critical systems, providing solutions such as electromechanical actuators and control mechanisms, engine ignition and related technologies, precision pumps and valves, power regulation equipment, specialized electric motors and generators, energy storage units, data communication and power management systems, diverse sensors, switching gear, and material handling equipment including hoists and cargo systems. This segment caters to a broad clientele, including engine and power system manufacturers, airlines, independent maintenance providers, governmental defense agencies, and aircraft repair facilities. The Airframe segment delivers structural and interior components. Its offerings encompass custom latching and locking mechanisms, structural rods and connectors, resilient sealing solutions, cockpit safety and display units, advanced audio, radio, and antenna technologies, restroom facilities, passenger safety restraints, bespoke interior panels and associated parts, thermal management and insulation products, illumination and control systems, and parachutes. Its customer base includes airframe constructors, cabin system integrators, commercial airlines, third-party maintenance organizations, military procurement offices, and overhaul centers. Beyond aviation, the Non-Aviation segment addresses diverse industrial needs. It supplies safety harnesses for ground vehicles, electromechanical actuators for space vehicles, hydraulic and electromechanical actuators and fuel valves for terrestrial gas turbines, specialized refueling systems for heavy machinery in sectors like mining and construction, and sophisticated turbine controls for the energy and petrochemical industries. This segment's clients span suppliers of off-road vehicles and their subsystems, manufacturers of child safety seats, providers of satellite and space systems, and producers of heavy industrial equipment. Established in 1993, TransDigm Group Incorporated maintains its headquarters in Cleveland, Ohio.
- Sector
- Industrials
- Industry
- Aerospace & Defense
- CEO
- Michael J. Lisman