Heico delivered a mixed quarter with a decent organic growth in revenues that reflects higher demand for the bulk of its commercial aircraft products and services given the ongoing recovery in commercial air travel. This helped the company surpass the revenue expectations of analysts. Operating income for the Flight Support Group climbed by 60% to $83.6 million in the first quarter of fiscal 2023. However, the business incurred $5.1 million in acquisition costs due to the conclusion of the Exxelia International acquisition which possibly led to Heico missing out on earnings expectations of Wall Street. Operating profit for the Electronic Technologies Group decreased by 22.2% due to the expenditures associated with the Exxelia acquisition, the lower gross profit margin, higher SG&A expenses as a percentage of net sales, and reduced performance-based incentive expense. However, the company anticipates significant growth for the ETG segment. During the quarter, they completed the acquisition of Precise Engineering as well. This acquisition is anticipated to drive the company’s growth prospects. We give HEICO Corporation a ‘Hold’ rating with a revised target price.
Our Report Structure:
⦁ Company Overview
⦁ Investment Thesis
⦁ Key Drivers
⦁ Historical Quarterly Statement Analysis – Income Statement & Cash Flows
⦁ Historical Quarterly Balance Sheet Analysis
⦁ Historical Annual Financial Statement Analysis
⦁ Analysis Of Key Financial Ratios
⦁ Financial Forecasts For 3 Years
⦁ Forecasting The Capital Structure & Net Debt
⦁ Discounted Cash Flow Valuation
⦁ Trading Multiples
⦁ Key Risks
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