Is Heico Corporation (HEI) overvalued?
On Equity Rank's model estimate, HEI trades 83% above its fair value. Heico Corporation (HEI) last closed at $332.65; the multi-method model fair value is $181.84.
| Price | Model fair value | Price vs model |
|---|---|---|
| $332.65 | $181.84 | 83% above |
What the answer rests on
- 0 of 9 valuation methods put HEI's value above its price and 9 put it below, so the methods mostly agree.
- To justify today's price, HEI's free cash flow would need to grow about 21.4% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 25.5% a year.
- HEI trades at 56.3 times its last year's earnings, against a median of 31.4 for 37 profitable Aerospace & Defense companies.
- Over the past year the price sat below the model fair value on 12% of trading days. The gap ranged from 5% below to 164% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind HEI's fair value · What prices assume · Other companies