There is no way HEICO Corporation (HEI) can keep these numbers up

HEICO Corporation (NYSE: HEI) stock fell -1.95% on Thursday to $160.07 against a previous-day closing price of $163.26. With 0.51 million shares changed hands, the volume of the stock remained heavier than its average volume of 0.33 million shares. During the session, the Aerospace & Defense company that operates in wider Industrials sector, reached to the highest price of $163.85 whereas the lowest price it dropped to was $160.03. The 52-week range on HEI shows that it touched its highest point at $180.59 and its lowest point at $126.95 during that stretch. It currently has a 1-year price target of $177.33. With its current market cap of 19.31 billion, HEI has annualized dividend of $0.20 while the current yield stands at 0.12%. Beta for the stock currently stands at 1.17.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of HEI was down-trending over the past week, with a drop of -10.42%, but this was down by -2.76% over a month. Three-month performance dropped to -8.46% while six-month performance fell -1.53%. The stock gained 18.53% in the past year, while it has gained 4.19% so far this year. A look at the trailing 12-month EPS for HEI yields 2.59 with Next year EPS estimates of 3.49. For the next quarter, that number is 0.77. This implies an EPS growth rate of 15.40% for this year and 15.79% for next year. EPS is expected to grow by 15.71% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 13.20%.

Float and Shares Shorts:

At present, 136.66 million HEI shares are outstanding with a float of 116.36 million shares on hand for trading. On May 14, 2023, short shares totaled 1.77 million, which was 1.29% higher than short shares on Apr 13, 2023. In addition to Mr. Laurans A. Mendelson as the firm’s Chairman & CEO, Mr. Eric A. Mendelson serves as its Co-Pres & Director.

Institutional Ownership:

Through their ownership of 70.36% of HEI’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 42.58% of HEI, in contrast to 29.16% held by mutual funds. Shares owned by individuals account for 27.93%. As the largest shareholder in HEI with 6.02% of the stake, The Vanguard Group, Inc. holds 3,291,959 shares worth 3,291,959. A second-largest stockholder of HEI, Capital Research & Management Co, holds 3,011,526 shares, controlling over 5.51% of the firm’s shares. BlackRock Fund Advisors is the third largest shareholder in HEI, holding 2,540,839 shares or 4.65% stake. With a 5.11% stake in HEI, the American Funds Growth Fund of Ame is the largest stakeholder. A total of 2,795,023 shares are owned by the mutual fund manager. The BlackRock Mid Cap Growth Equity P, which owns about 2.47% of HEI stock, is the second-largest Mutual Fund holder. It holds 1,348,541 shares valued at 227.42 million. Government Pension Fund – Global holds 1.87% of the stake in HEI, owning 1,023,583 shares worth 172.62 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Apr 29, 2023, HEI reported revenue of $538.81M and operating income of $122.78M. The EBITDA in the recently reported quarter was $146.58M and diluted EPS was $0.62.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for HEI since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With HEI analysts setting a high price target of $237.00 and a low target of $145.00, the average target price over the next 12 months is $189.00. Based on these targets, HEI could surge 48.06% to reach the target high and fall by -9.41% to reach the target low. Reaching the average price target will result in a growth of 18.07% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded HEI stock several times over the past three months with 1 Buys and 4 Sells. In these transactions, 20,000 shares were bought while 20,920 shares were sold. The number of buy transactions has increased to 21 while that of sell transactions has risen to 29 over the past year. The total number of shares bought during that period was 339,252 while 193,352 shares were sold.

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