Core Thesis - TransDigm Group Incorporated (TDG) is viewed positively due to its strong market position in specialized aircraft components, resilient aftermarket sales, and effective M&A strategy [1][5]. Company Overview - TDG designs and manufactures specialized aircraft components, with approximately 75% of sales being sole-source and about 90% proprietary products, ensuring strong pricing power and recurring revenue [2]. - The company derives roughly half of its revenue from aftermarket spare and replacement parts, which contributes to its durable demand [2]. Financial Performance - In Q3 2025, TDG experienced a mixed performance: commercial OEM revenue declined by approximately 7% year-over-year, while commercial aftermarket revenue grew by about 6%, driven by double-digit growth in engine content and distributor sales [3]. - Defense revenues increased by 13% across OEM and aftermarket channels, showcasing strength in this segment [3]. - EBITDA margins improved to 54.4%, with organic growth of 6.3%, operating cash flow exceeding $630 million, and a cash balance near $2.8 billion [3]. Leadership and Strategic Moves - Leadership transitions include CEO Kevin Stein's retirement and COO Mike Lisman taking over as CEO, indicating depth in management [4]. - TDG completed the acquisition of Servotronics for $138 million and agreed to acquire Simmonds Precision for $765 million, expected to add approximately $350 million in revenue in CY25 [4]. Future Outlook - FY25 guidance anticipates revenue of $8.79 billion, EBITDA of $4.725 billion, EPS of $36.74, and free cash flow around $2.3 billion [4]. - The company has repurchased over 400,000 shares year-to-date and declared a special dividend of $90 per share, funded via debt [4]. - TDG is considered a compelling long-term investment opportunity, particularly if shares trade below $1,200 [4].