AIR vs HEI: Which Is the Better Buy in 2026?

Same yardstick, side by side (as of August 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.

Reading it: AIR is the cheaper of the two on forward earnings, but cheaper is not the same as better. Pair the valuation with growth (how far the forward P/E sits below the trailing P/E) and risk (beta) before you decide.

The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. AIR and HEI share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.

This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined AIR and HEI exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.

AAR Corp is a leading independent provider of aviation services to commercial airlines, government and defense operators, MRO shops, and OEMs. It operates across four segments: Parts Supply (selling and leasing used serviceable material and new parts), Repair & Engineering (airframe and component maintenance), Integrated Solutions (including the Trax cloud MRO software platform and government logistics programs), and Expeditionary Services (mobility and pallet products). The business is squarely an aftermarket story: it makes money keeping existing aircraft flying rather than building new ones, which gives it exposure to global flight hours, fleet age, and defense sustainment budgets.

Full AIR guide

HEICO Corporation is a diversified aerospace and defense company best known for making FAA-approved replacement parts for commercial jet engines and aircraft. Its Flight Support Group designs and manufactures aftermarket parts that are functionally equivalent to original equipment manufacturer (OEM) parts but sold at lower prices, plus it repairs and overhauls components. Its Electronic Technologies Group makes specialized electronic, microwave, and electro-optical products for defense, space, medical, and other demanding applications. HEICO makes money by selling parts and services that airlines, MRO shops, and defense primes need on a recurring basis, often tied to aircraft flight hours and fleet aging. The company is controlled by the Mendelson family and has a long record of disciplined, acquisition-driven growth, having bought dozens of niche suppliers over the years. Founded in its current form in the 1950s and headquartered in Hollywood, Florida, HEICO is widely regarded as a high-quality compounder in aerospace.

Full HEI guide

Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.

• AIR drivers: Aging global fleet and record flight activity; Shift toward higher-value repair and software.
• HEI drivers: Aftermarket parts moat; Acquisition-driven growth.

A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: AIR is cyclical: a downturn in air travel, airline capacity cuts, or a recession would reduce flight hours and maintenance demand. For HEI, hEICO trades at a premium valuation that embeds continued high growth, so any slowdown in commercial air traffic, a deep airline downturn, or a pause in its acquisition pipeline could compress the multiple.

Pick AIR if you believe its drivers more; HEI if you believe its. Many investors hold both, but since they share themes, that is a concentrated bet, not diversification. Decide deliberately and check overlap. For the full detail, see the AIR and HEI guides.

AIR. AAR posted accelerating growth through fiscal 2026, with quarterly sales climbing from roughly $740M to about $845M and adjusted EBITDA and EPS growing at double-digit rates. Management guided full-year fiscal 2026 to roughly 19% total sales growth and about 12% organic growth. The roughly 31x earnings multiple reflects those expectations, so the valuation embeds continued execution.

HEI. HEICO commands one of the highest valuations in aerospace and defense, reflecting its consistent double-digit growth, high margins, recurring aftermarket demand, and a long record of value-accretive acquisitions. The premium multiple is the market's way of paying up for a proven compounder; it leaves limited room for execution missteps and has historically compressed mainly during broad market or aerospace downturns.

Headline figures (approximate, JULY 2026): AIR shows revenue (ttm) ~$3.1B, q3 fy2026 sales ~$845M (up ~25% YoY), q3 fy2026 adj. eps ~$1.25 (up ~26% YoY), market cap ~$5.6B; HEI shows revenue (ttm) ~$4 billion, operating margin ~22%, net income (ttm) ~$550 million, p/e (ttm) ~55x.

AIR and HEI are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined AIR and HEI exposure against your real portfolio. It is not an investment adviser.