Shares of aerospace and defense company Heico (HEI.US) have pulled back to their lowest level since May 2025 and continue their downward momentum amid concerns over airline industry conditions in the context of conflicts in the Middle East and rising jet fuel prices. The prospect of fewer flights may translate into lower demand for repairs and spare parts, potentially putting pressure on revenue growth in the medium term. Although the company reported record results for the last quarter, the market has generally been repricing companies with exposure to the civil aerospace sector, and Heico’s revenue mix is roughly balanced between commercial and defense segments.
Moreover, in recent quarters it has been the commercial segment that has grown faster. The market has used the uncertain environment as an opportunity to take profits, with the stock now down حوالي 20% from its historical peak — the largest decline since spring last year. It is worth noting, however, that while the company is pro-cyclical, it has historically navigated downturns successfully and remains one of the top long-term performers among publicly listed companies since 1990. Investors continue to pay a significant premium for the stock, with the forward 12-month P/E ratio close to 50, and price-to-sales and price-to-book ratios around 9.
Heico (HEI.US)
The current drawdown relative to the 200-session EMA (EMA200) stands at around 10%, a level that has historically been rare and, between 2020 and 2026, consistently followed by demand-driven rebounds. If the Strait of Hormuz is unblocked in the near term, this could act as a strong catalyst for the stock. If disruptions persist, however, the market may continue to approach the company with caution.
Source: xStation5
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