Astronics vs. Heico: Which Aerospace Tech Stock Has More Lift in 2025?

Increasing commercial aircraft production, driven by steadily growing global air traffic, combined with robust growth in aftermarket services, is fueling demand for aerospace technology stocks, such as Astronics Corporation ATRO and HEICO Corporation HEI. Simultaneously, heightened geopolitical tensions are prompting increased defense budgets worldwide, thereby driving demand for advanced avionics, electronic and power systems, as well as other aerospace components for varied combat aircraft, which are supplied by both ATRO and HEI.Astronics focuses on designing and manufacturing advanced technologies in electrical power, lighting, connectivity, and cabin electronics, serving both commercial airlines and military customers. Its niche offerings in inflight entertainment and power systems cater to the growing need for smarter, more connected aircraft cabins. HEICO, by contrast, is the world's largest independent aerospace parts manufacturer and supplier of jet engines and aircraft components. As aerospace electrification, digitalization, and global fleet expansion draw investor interest, a question arises: Which company offers better returns and resilience to its stakeholders? A comparative evaluation of ATRO and HEI's fundamentals should help determine which stock presents greater upside potential.How Do Financial Stability & Growth Catalysts Stack up for ATRO vs HEI?Astronics ended March 2025 with a cash and cash equivalent of $26 million. While its long-term debt totaled $160 million, as of March 2025-end, its current debt was nil. So, it is safe to conclude that the stock boasts a solid solvency position in the near term, which should enable it to duly meet its capital expenditure target of $35-$40 million in 2025. A major part of this investment is expected to be dedicated to new product innovations to effectively expand core competency in its existing business. This financial stability should also bolster ATRO’s strategy of enhancing its value through strategic acquisitions. In contrast, Heico’s cash and cash equivalents, as of April 30, 2025, totaled $0.24 billion, which improved sequentially. The company’s long-term debt, as of April 30, 2025, was $2.27 billion, while its current debt was $0.04 billion. So, it is safe to conclude that Heico holds a strong solvency position in the short run, which should offer the stock the flexibility to carry on its disciplined acquisition strategy, which has always been part of its growth story. With respect to growth drivers, the steadily improving air passenger traffic worldwide (for the past couple of years), following a major setback during the initial years of the COVID-19 pandemic, has been playing the role of the primary growth catalyst for both ATRO and HEI. Evidently, Astronics registered an 11.3% year-over-year sales improvement in first-quarter 2025, partially backed by a solid 13.3% surge in its sales to the commercial transport market. Heico’s Flight Support group unit recorded a solid 14% organic sales growth, during fiscal second-quarter 2025, owing to continued increase in commercial aerospace product sales. Sales growth for defense-related aerospace parts and equipment, backed by increasing defense product acquisition trend worldwide, has also been contributing to both ATRO and HEI’s top-line performance. Notably, an impressive 94.8% improvement in sales to the military aircraft market partially drove the 11.3% year-over-year overall sales improvement for ATRO in the first quarter of 2025. On the other hand, increased demand for defense products played a vital role in HEI’s Electronic Technologies Group unit’s organic sales growth of 4% in the fiscal second quarter.Risks of Investing in ATRO vs HEI:  With ATRO and HEI operating in the broader aerospace sector, both stocks face industry-specific challenges that investors should consider before investing in them. In 2025, while both Boeing BA and Airbus have signaled intentions to increase aircraft production rates compared to 2024, actual growth so far has been slower than anticipated and remains below pre-pandemic levels. This shortfall is primarily due to ongoing supply-chain disruptions, an issue that continues to affect component suppliers like ATRO and HEI. Given that both companies count Boeing and Airbus among their key OEM clients, the limited availability of critical parts and the resulting delays in aircraft assembly could suppress demand for the specialized equipment and systems supplied by ATRO and HEI. Consequently, this may weigh on their commercial aerospace revenue growth in the near term. Moreover, the recently imposed U.S. import tariffs on many of the nation’s trading partners could cause long-term disruptions in global trade, with the aerospace sector being no exception, thus further exacerbating this sector’s supply-chain challenges. This, in turn, may negatively impact the commercial aerospace business of both ATRO and HEI.How Do Zacks Estimates Compare for ATRO & HEI?The Zacks Consensus Estimate for ATRO’s 2025 sales and earnings per share (EPS) implies an improvement of 6.4% and 37.6%, respectively, from the year-ago quarter’s reported figures. ATRO’s near-term EPS estimates have shown an upward movement over the past 60 days.Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for HEI’s fiscal 2025 sales implies a year-over-year improvement of 13.2%, while that for EPS suggests a 23.4% surge. The stock’s near-term EPS estimates have shown upward movement over the past 60 days.Image Source: Zacks Investment ResearchStock Price Performance: ATRO vs HEIATRO (up 38.4%) has outperformed HEI (up 21.9%) over the past three months. Also, in the past year, ATRO has outperformed HEI. While ATRO’s shares surged 69.8%, HEI rose 47.6%.Image Source: Zacks Investment ResearchAstronics’ Valuation More Attractive Than HeicoAstronics is trading at a discount, with its forward 12-month price/earnings of 20.01X being lower than HEI’s forward price/earnings of 66.07X.Image Source: Zacks Investment ResearchATRO Less Leveraged Than HEIGiven that these stocks are facing the brunt of the supply-chain challenge, which is still affecting the aerospace sector, a comparative analysis of their long-term debt-to-capital suggests that ATRO is less debt-ridden than HEI.Image Source: Zacks Investment ResearchATRO’s ROE Better Than HEIA comparative analysis of both these stocks’ Return on Equity (ROE) suggests that ATRO is more efficient at generating profits from its equity base than HEI.Image Source: Zacks Investment ResearchFinal CallBoth Astronics and Heico are poised to benefit from long-term aerospace trends, such as electrification, defense modernization and global fleet expansion. ATRO has demonstrated stronger recent stock performance and a better ROE, reflecting more efficient capital utilization. It is also less leveraged, which is advantageous in a supply–chain–constrained environment. While HEI benefits from scale and a proven acquisition-driven growth model, its higher debt levels and premium valuation may limit near-term upside. Considering ATRO’s improving financials and relatively attractive valuation, Astronics currently appears to offer a more compelling investment opportunity than Heico for investors seeking growth with a margin of safety.  That said, HEI’s consistent performance and strong fundamentals ensure it remains a solid investment contender in the aerospace space.Both ATRO and HEI sport a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks Rank #1 stocks here.    Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Boeing Company (BA): Free Stock Analysis Report Astronics Corporation (ATRO): Free Stock Analysis Report Heico Corporation (HEI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks