Even though HEICO (currently trading at $303.12 per share) has gained 10% over the last six months, it has lagged the S&P 500’s 16.6% return during that period. This might have investors contemplating their next move.
Given the relatively weaker price action, is now a good time to buy HEI, or is it a pass? Find out in our full research report, it’s free.
Why Are We Positive on HEICO?
Founded in 1957, HEICO (NYSE: HEI) manufactures and services aerospace and electronic components for commercial aviation, defense, space, and other industries.
1. Skyrocketing Revenue Shows Strong Momentum
A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Thankfully, HEICO’s 23.8% annualized revenue growth over the last five years was incredible. Its growth surpassed the average industrials company and shows its offerings resonate with customers.
2. Outstanding Long-Term EPS Growth
Analyzing the long-term change in earnings per share (EPS) shows whether a company’s incremental sales were profitable — for example, revenue could be inflated through excessive spending on advertising and promotions.
HEICO’s astounding 24.2% annual EPS growth over the last five years aligns with its revenue performance. This tells us its incremental sales were profitable.
3. Excellent Free Cash Flow Margin Boosts Reinvestment Potential
Free cash flow isn’t a prominently featured metric in company financials and earnings releases, but we think it’s telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.
HEICO has shown terrific cash profitability, putting it in an advantageous position to invest in new products, return capital to investors, and consolidate the market during industry downturns. The company’s free cash flow margin was among the best in the industrials sector, averaging 17.7% over the last five years.
Final Judgment
These are just a few reasons why HEICO ranks near the top of our list. With its shares underperforming the market lately, the stock trades at 44.3× forward P/E (or $303.12 per share). Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Stocks We Like Even More Than HEICO
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Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
