Assessing TTM Technologies (TTMI) Valuation After Multi Year US$200 Million Raytheon Defense Deal

TTM Technologies (TTMI) is back in focus after agreeing a multi year supply deal with Raytheon worth up to US$200 million, tied to hardware for the Lower Tier Air and Missile Defense Sensor program.

See our latest analysis for TTM Technologies.

The Raytheon agreement lands at a time when momentum in TTM Technologies' shares has been strong, with a 30 day share price return of 37.61% and a 90 day gain of 58.10% contributing to a very large 1 year total shareholder return.

If this kind of defense related story has your attention, it could be worth checking out aerospace and defense stocks as a way to spot other potential names on your radar.

With the shares up sharply and trading only about 5% below the average analyst price target of US$103.25, the key question now is whether TTMI still offers value or if the market is already pricing in future growth.

Most Popular Narrative: 5.6% Overvalued

At $97.99, TTM Technologies is trading above the most followed fair value estimate of $92.75. This estimate is built using an 8.69% discount rate and detailed assumptions about growth and profitability.

Ongoing expansion into higher value engineered solutions and advanced manufacturing capabilities, particularly through new capacity in Penang and Syracuse and product mix shifts, increases pricing power and drives gross margin improvements over time, enhancing net margin profile.

Read the complete narrative.

Want to understand why this narrative still supports a fair value close to today's price? The core story leans on stronger margins, faster top line growth, and a richer earnings profile a few years out. Curious which of these factors does the heavy lifting in the model and how sensitive the outcome is to those assumptions?

Result: Fair Value of $92.75 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this hinges on execution, and issues such as a slower ramp up in Penang or underused, higher cost US capacity could quickly challenge the upbeat margin story.

Find out about the key risks to this TTM Technologies narrative.

Build Your Own TTM Technologies Narrative

If you look at the numbers and come to a different conclusion, or simply prefer to test your own assumptions, you can build a custom view in just a few minutes using Do it your way.

A great starting point for your TTM Technologies research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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