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TransDigm GroupTDG +0.06%89 Interest Coverage is 2.45 as of Mar. 2026, which is 1% below its 10-year median of 2.48. GuruFocus rates TDG with a GF Score™ of 89/100 and a GF Value™ of $1,609.46 (Modestly Undervalued). The stock has 5 warning signs investors should review. Among 242 Aerospace & Defense companies, TransDigm Group ranks worse than 83.47% on this metric.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's
Operating Income
by its Interest Expense. TransDigm Group's
Operating Income
for the
three
months ended in Mar. 2026 was $1,187 Mil. TransDigm Group's Interest Expense for the
three
months ended in Mar. 2026 was $-484 Mil.
TransDigm Group's interest coverage for the quarter that ended in Mar. 2026 was 2.45.
The higher the ratio, the stronger the company's financial strength is.
Warning Sign:
Ben Graham prefers companies' interest coverage to be at least 5. TransDigm Group Inc interest coverage is 2.5, which is low.
The historical rank and industry rank for TransDigm Group's Interest Coverage or its related term are showing as below:
TDG'
s Interest Coverage Range Over the Past 10 Years
Min: 1.6 Med: 2.48 Max: 2.78
Current: 2.5
TDG's Interest Coverage is ranked worse than 83.47% of 242
companies
in the Aerospace & Defense industry
Industry Median: 8.285
vs TDG: 2.50
TransDigm Group (NYSE:TDG) Interest Coverage Explanation
Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.
Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .
TransDigm Group Interest Coverage Related Terms
TransDigm Group Interest Coverage Historical Data
* Premium members only.
The historical data trend for TransDigm Group's Interest Coverage can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.
TDG vs NOC, HONAV, GD: Interest Coverage Comparison
For the Aerospace & Defense subindustry, TransDigm Group's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
TransDigm Group Interest Coverage vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, TransDigm Group's Interest Coverage distribution charts can be found below:
* The bar in red indicates where TransDigm Group's Interest Coverage falls into.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
TransDigm Group (TDG) has a Interest Coverage of 2.45 as of Mar. 2026. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on TransDigm Group and its competitors. This is near median its historical median of 2.48. Over the past decade, TransDigm Group's Interest Coverage has ranged from 1.60 to 2.78. According to the industry distribution chart, TransDigm Group ranks #202 out of 242 companies in the Aerospace & Defense industry, placing it in the top 83.5%.
Is TransDigm Group's Interest Coverage too high?
TransDigm Group's current Interest Coverage of 2.45 is near median its 10-year median of 2.48. Over the past 10 years, this metric has ranged from a low of 1.60 to a high of 2.78. The Aerospace & Defense industry median Interest Coverage is 8.29. TransDigm Group's value of 2.45 is 70.4% below this industry median. Based on the distribution chart, TransDigm Group ranks #202 out of 242 companies in the Aerospace & Defense industry, which is in the bottom quartile relative to peers. Overall, TransDigm Group has a GF Score™ of 89/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does TransDigm Group's Interest Coverage compare to NOC and HONAV?
According to the Aerospace & Defense industry distribution chart, TransDigm Group ranks #202 out of 242 companies for Interest Coverage. This places TransDigm Group in the lower half of its industry. The industry median Interest Coverage is 8.29. TransDigm Group's value of 2.45 is 70.4% below this benchmark. Historically, TransDigm Group's own Interest Coverage has ranged from 1.60 to 2.78 over the past decade. While the company's 10-year median is 2.48 vs. the industry median of 8.29, TransDigm Group has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Interest Coverage for an Aerospace & Defense company?
The median Interest Coverage among Aerospace & Defense companies is 8.29, based on 242 companies in the industry. Companies in the top quartile (top 25%) have a Interest Coverage significantly above this median, while those in the bottom quartile fall well below. However, Interest Coverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. TransDigm Group's current Interest Coverage of 2.45 is 70.4% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Interest Coverage mean?
A high Interest Coverage can signal that a stock is expensive relative to its fundamentals. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on TransDigm Group and its competitors. For the Aerospace & Defense industry, the median Interest Coverage is 8.29 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. TransDigm Group's current Interest Coverage is 2.45, which is near median its own 10-year median of 2.48. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is TransDigm Group stock overvalued right now?
Based on GuruFocus' analysis, TransDigm Group (TDG) is currently considered Modestly Undervalued. The stock's GF Value™ is $1,609.46, compared to a current price of $1,205.49 — trading 25.1% below its estimated fair value. The current Interest Coverage is 2.45, which is near median its 10-year median of 2.48 and 70.4% below the Aerospace & Defense industry median of 8.29. TransDigm Group's overall GF Score™ is 89/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Interest Coverage calculated?
Interest Coverage is calculated from a company's financial statements. For TransDigm Group (TDG), the current Interest Coverage is 2.45 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is TransDigm Group (TDG) Overvalued in 2026?
Based on GuruFocus' analysis, TransDigm Group stock appears to be undervalued.
The current stock price of $1,205.49 is trading 25.1% below its estimated GF Value™ of $1,609.46.
GuruFocus considers TransDigm Group to be Modestly Undervalued.
Key valuation signals for TDG:
Interest Coverage: 2.45 (near median its 10-year median of 2.48)
GF Value™: $1,609.46 vs. price of $1,205.49 (25.1% below fair value)
Industry Position: 70.4% below the Aerospace & Defense median (#202 of 242)
No single metric tells the full story. See the TDG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
TransDigm manufactures and services a broad set of specialized parts for commercial and military aircraft. The firm organizes itself in three segments: power and control, airframes, and a small non-aviation segment, which serves mostly off-road vehicles and mining equipment. It operates as an acquisitive holding company that focuses on buying up smaller firms that make proprietary aerospace products with substantial aftermarket demand. TransDigm regularly employs financial leverage to amplify its operating results.
89GF Score
Get the complete analysis for TDG
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