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FINWIRES

Research Alert: CFRA Maintains Sell Opinion On Shares Of Transdigm Group Incorporated

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lower our 12-month target by $9 to $1,061, or 26.2x our FY 27 (Sep.) EPS estimate, below TDG's three-year average forward P/E of 33.7x. We increase our FY 26 EPS by $1.28 to $39.48 and maintain FY 27's at $40.49. Despite strong Q2 results (18% revenue growth, raised FY 26 guidance), we see multiple headwinds. Recent acquisitions totaling $3.2B are margin dilutive; we forecast EBITDA margins down 150 bps in FY 26. Net debt/EBITDA of ~5.9x following acquisitions amplifies refinancing risk beyond FY 27, while elevated interest expense constrains EPS growth. Middle East conflict adds commercial aftermarket uncertainty for 2H 2026, with potential lag effects on flight activity and parts demand. Given our outlook for decelerating growth, we anticipate the earnings multiple will continue to contract after the forward P/E declined from 34.6x at end-2025 to ~28.5x. TransDigm's reliance on sole-source, high-margin defense products makes it particularly exposed to potential DoD procurement reforms targeting pricing.

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Research Alert: CFRA Maintains Hold On Shares Of Solventum Corporation

CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We lower our 12-month price target by $6 to $76, reflecting an 11.6x multiple of our 2026 EPS estimate, in line with the 11.6x historical forward average since spin-off from 3M in 2024. We raise our 2026 EPS estimate to $6.57 from $6.46 and lower our 2027 estimate by $0.03 to $7.03. We think SOLV continues to demonstrate progress with the separation from 3M, having exited over 50% of the transition service agreements with a target to exit over 90% by year-end. In addition, over 75% of system applications have been migrated, according to Q1 earnings commentary. The company maintained the $100M-$120M estimate of tariff headwinds against 2026 earnings. However, this estimate was made based on tariff dynamics prior to the U.S. Supreme Court's recent ruling against the IIEPA tariffs, adding some uncertainty to SOLV's near-term financial outlook, in our view, as the company awaits more information about potential refund dynamics.

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