Airlines have been the driving force behind the market's reaction to Iran's ongoing war in recent weeks. Although the share prices of many leading airlines fell after the United States launched the attack, many have recovered. This is not the only volatility shaking the industry this year; As budget carrier Spirit Airlines has announced it will close, uncertainty is likely to increase for investors as well.
Despite these challenges, there may still be opportunities in the broader aerospace industry. Specifically, investors may look to companies involved in aircraft maintenance, those that manufacture and distribute aftermarket parts, and related activities. Some of these companies have been hit hard by the uncertainty of the war, but they maintain a strong business and may be ready to rise if external conditions are favorable.
TransDigm's Base Business Is Strong, Even As Middle East Conflict Threatens Share Price
Company TransDigm Group Inc. NYSE: TDG designs and manufactures engineered aircraft components and systems for both commercial and military applications. While the aerospace industry as a whole has performed well so far in 2026, TDG shares have not. The company's share price has fallen by about 10% year-to-date (YTD). The decline may be due to the risks of their commercial business stemming from both inflation and country factors.
Transdigm Group Today
The Transdigm Group
- 52 week interval
- $1,123.61
▼
$1,623.82
- The P/E ratio
- 37.49
- Target Value
- $1,521.24
At the same time, TransDigm showed signs of strength, especially in its latest earnings report, released at the beginning of May 2026. The company posted strong beats on both the top and bottom lines, with earnings per share (EPS) rising more than 8% year-over-year (YOY) and revenue rising more than 18% over the same period.
TransDigm drew the attention of investors last summer when it announced a special dividend that was 20% higher than the same special dividend issued in 2024. Of course, there is no guarantee that the company will provide another distribution of this type, but given the period of the last two years, investors may look for signals in late summer that another payment may be on the way.
Now, investors may be of two minds about the company as the conflict in the Middle East continues. On the other hand, the management admitted in the last earnings report that the company may see the business of the late commercial market in the coming quarters due to the decrease in the flight activity. On the other hand, however, TransDigm raised its financial guidance for 2026, with a midpoint revenue of $10.4 billion, about 17% higher than previously estimated. A surprisingly strong underlying performance could drive that performance, along with projected increases in EBITDA and EPS.
Together, this means that TransDigm's business may remain attractive even if external factors may extend the share price's rise, presenting a buying opportunity for those willing to wait. Analysts are divided on TDG shares, though they expect about 27% upside.
The Most Forgotten Company in the Airline Industry With Growing Revenues, Bookings, and More
If TransDigm has struggled YTD, Axon Enterprise Inc. NASDAQ: AXON it is in an even worse condition. Shares of the company best known as the maker of TASER energy weapons are down nearly 35% in 2026. Many investors may not know that Axon is also involved in the aerospace industry—particularly in unmanned aircraft systems, including maintenance, hardware, and software development for multi-purpose drones.
Axon Enterprise Today
As of 05/13/2026 04:00 PM Eastern
- 52 week interval
- $339.01
▼
$885.91
- The P/E ratio
- 151.33
- Target Value
- $712.75
In the first quarter of 2026, Axon saw revenue rise over a third YOY to $807 million, beating estimates, prompting management to raise guidance for full-year revenue growth in the 30% to 32% YOY range. The company has been able to deal with the AI threat so far, and Axon's AI Era Plan has experienced 140% YOY booking growth. Business and global momentum continues.
Cash flow remains strong, with the company forecasting nearly $450 million in free cash flow this year. However, Axon has committed to spending significant cash to consolidate its inventory this year in anticipation of potential setbacks, which could hamper some of its ability to expand operations in other areas.
With a price-to-earnings (P/E) ratio of nearly 150, AXON shares are still not cheap. Still, Wall Street's assessment of the stock is very positive: 16 out of 19 analysts rated it a Buy. The consensus price target of more than $712 per share represents a significant upside from current price levels.
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