Figure 12: Valuation Comparables ($ in billions, except per share amounts) Valuation: Shares at the Upper End of the Range, and Should Stay There TransDigm shares currently trade at $25.45, or 20.7x our calendar year 2006 EPS estimate of $1.23, which is at middle to upper end of the valuation range for the commercial aerospace universe. Given the company's sizable growth potential, we anticipate that the company's premium valuation will continue in the future. Our $29 price target is based on the belief that the shares can trade at 20.3x our calendar year 2007 EPS estimate of $1.43 within the next 12 months. TDG BA Stock Price as of 04/21/06 Dividend Yield _COL_ GR AVL* BEAV High Low Median $86.46 $58.86 $45.26 1.4% 0.8% 1.8% $37.63 0.0% $27.07 0.0% 2006E P/E 24.0x 21.4x 19.2x 19.4x 23.5x TEV/EBITDAP 10.1x 11.6x 8.2x 9.3x 13.9x Free Cash Flow/Market Cap. 6.6% 4.8% 3.6% Free Cash Flow/Net Income 157% 102% 70% 2007E P/E TEV/EBITDAP Free Cash Flow/Market Cap. Free Cash Flow/Net Income *Estimates represent consensus estimates All estimates are calendar year estimates 19.2x 18.6x 15.9x 17.2x 21.3x 8.2x 10.1x 7.2x 8.7x 10.6x 8.4% 4.4% 4.9% 160% 82% 77% Source: Lehman Brothers estimates, Thomsonone Analytics and company reports