Company Overview Supplying parts for nearly all aircraft currently in service, TransDigm (NYSE:TDG) develops and manufactures components and systems for military and commercial aviation. TransDigm was formed through a merger of four industrial aerospace companies and originally sold a small array of aircraft components such as batteries and pumps. A key part of its business model is to acquire airplane parts companies and raise prices. In its first 25 years of operating, it acquired over 60 businesses, enabling it to manufacture not only aircraft systems but also a range of aircraft components like engines, electronics, and interiors. TransDigm generally sells its products to four types of customers: defense organizations, commercial airlines, original equipment manufacturers (OEM), and maintenance, repair, and overhaul providers. The company’s products are used by OEMs to create new aircraft while overhaul providers, defense organizations, and commercial airlines use its components for maintenance and upgrading of existing aircraft. Due to the specificity and wear-and-tear of aircraft components, TransDigm usually enters long-term contracts with most of its customers. A majority of sales come from aftermarket services, and the company uses third-party distributors to reach broader markets. A potential risk for TransDigm is regulators stepping in and limiting its ability to acquire more businesses and raise prices. The company has come under regulatory security several times, but as of today, continues to march along.