For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in Heico Corporation HEI ten years ago? It may not have been easy to hold on to HEI for all that time, but if you did, how much would your investment be worth today?
Heico Corporation's Business In-Depth
With that in mind, let's take a look at Heico Corporation's main business drivers.
The Flight Support Group consists of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp., and their collective subsidiaries. The group uses proprietary technology to design and manufacture jet engine and aircraft component replacement parts. In addition, it repairs, overhauls and distributes jet engine and aircraft components, avionics and instruments. The segment also manufactures thermal insulation products, complex composite assemblies and other component parts, primarily for aerospace, defense, industrial and commercial applications. Net sales for this group were $1.77 billion in fiscal 2023, contributing 59% to the company's total sales.
The Electronic Technologies Group consists of HEICO Electronic Technologies Corp. and its subsidiaries. It designs, manufactures and sells various types of electronic, microwave and electro-optical products. These products include infrared simulation and test equipment, laser rangefinder receivers, electrical power supplies, back-up power supplies, power conversion products, underwater locator beacons, electromagnetic interference and radio frequency interference shielding, high power capacitor charging power supplies, amplifiers, photo detectors, and radio frequency and microwave amplifiers. Net sales for this group were $1.23 billion in fiscal 2023, contributing 41% to the company's total sales.
Total sales consisted of intersegment expenses of $0.27 billion.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Heico Corporation, if you bought shares a decade ago, you're likely feeling really good about your investment today.
A $1000 investment made in June 2014 would be worth $8,514.68, or a 751.47% gain, as of June 28, 2024, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
Compare this to the S&P 500's rally of 179.60% and gold's return of 69.74% over the same time frame.
Looking ahead, analysts are expecting more upside for HEI.
Heico ended the second quarter of fiscal 2024 on a bright note, with both its earnings and revenues surpassing their respective Zacks Consensus Estimate. It has been witnessing increased orders for its aftermarket replacement parts and repair and overhaul parts services, buoyed by a steadily recovering commercial air travel. Favorable projections for air travel in 2024 bode well. It also enjoys a solid presence in the defense industry. Heico holds a strong solvency position and its shares have outperformed the industry in the past six months. However, a supply shortage of aircraft components might affect its performance. Heico is exposed to stringent governmental regulations and failure to comply with them might lead to a material adverse impact on its business. The company's shares remain expensive compared with its industry.
The stock is up 5.43% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 8 higher, for fiscal 2024. The consensus estimate has moved up as well.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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