The aerospace industry is riding a wave of growth as global conflicts across the world have sparked a surge in demand. This has led to swelling backlogs and a flood of orders from every corner of the globe. Meanwhile, recent administration changes in the United States have shaken things up. European countries are ramping up their aerospace orders and are eager to secure advanced technology.
Some nations have hesitated over U.S. orders amid shifting policies, but cancellations seem unlikely since trade wars have simmered down a bit. Beyond geopolitics, the industry is buzzing with other trends. The commercial aviation sector is roaring back with record passenger traffic. This has pushed airlines to modernize fleets with fuel-efficient aircraft.
Moreover, AI software is making defense aircraft more potent, and the entire industry has seen a bump in growth. The following 15 are gaining the most.
A huge in-process machining center producing parts for aircraft and aerospace systems.
Methodology
For this article, I screened the best-performing aerospace stocks year-to-date.
I will also mention the number of hedge fund investors in these stocks. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
15. AAR Corp (NYSE:AIR)
Number of Hedge Fund Holders In Q4 2024: 19
AAR Corp (NYSE:AIR) is an aerospace and defense aftermarket solutions company.
The stock is up significantly so far in 2025 as AAR Corp announced the sale of its Miami-based Landing Gear Overhaul business to GA Telesis for $51 million.
The transaction is expected to close in the first quarter of 2025. It is a part of AAR’s strategic portfolio optimization plan. It is anticipated to be immediately accretive to margins and earnings.
AAR Corp reported robust financial performance for the second quarter of fiscal year 2025, with sales reaching $686 million, up 26% year-over-year.
Moreover, AAR signed a multi-year component repair agreement with Cebu Pacific Air to provide nacelle maintenance, repair, and overhaul services for its A320 fleet powered by CFM56-5B engines.
The consensus price target of $81.5 implies 16.85% upside.
AIR stock is up 13.61% year-to-date.
14. Heico Corp (NYSE:HEI)
Number of Hedge Fund Holders In Q4 2024: 67
Heico Corp (NYSE:HEI) is an aerospace, industrial, defense, and electronics company.
The stock is up significantly so far in 2025, as Heico reported record-breaking financial results for Q1 2025. Revenue of $1.03 billion increased 15% year-over-year and exceeded analyst expectations by 5.1%.
Net income surged by 46% to $168 million, and EPS of $1.20 beat forecasts by 27%. Operating income rose by 26%, and EBITDA increased by 22% year-over-year to $273.9 million.
Heico also made some acquisitions that boosted the company’s financials.
The consensus price target of $271.4 implies 0.06% upside.
HEI stock is up 15.88% year-to-date.