It's been a good week for TransDigm Group Incorporated (NYSE:TDG) shareholders, because the company has just released its latest second-quarter results, and the shares gained 3.7% to US$1,319. The result was positive overall - although revenues of US$1.9b were in line with what the analysts predicted, TransDigm Group surprised by delivering a statutory profit of US$6.97 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Following the latest results, TransDigm Group's 21 analysts are now forecasting revenues of US$7.78b in 2024. This would be a satisfactory 6.5% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 6.0% to US$27.46. Before this earnings report, the analysts had been forecasting revenues of US$7.72b and earnings per share (EPS) of US$27.19 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The consensus price target rose 7.2% to US$1,372despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of TransDigm Group's earnings by assigning a price premium. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on TransDigm Group, with the most bullish analyst valuing it at US$1,648 and the most bearish at US$1,175 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the TransDigm Group's past performance and to peers in the same industry. The analysts are definitely expecting TransDigm Group's growth to accelerate, with the forecast 14% annualised growth to the end of 2024 ranking favourably alongside historical growth of 6.7% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 2.3% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect TransDigm Group to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple TransDigm Group analysts - going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 3 warning signs for TransDigm Group (2 are significant!) that you need to take into consideration.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.