GE Aerospace
GE
$366.70
-0.91%
GE Aerospace is the global leader in designing, manufacturing, and servicing commercial and military aircraft turbine engines, operating in the Aerospace & Defense industry. With a massive installed base of nearly 80,000 engines and a dominant position in the narrowbody market through its CFM joint venture with Safran, the company generates the majority of its profits from recurring, high-margin services revenue. The current investor narrative centers on the company's post-conglomerate transformation into a pure-play aerospace powerhouse, with strong demand from commercial aviation recovery and defense spending, but also faces concerns about supply chain constraints, geopolitical risks (e.g., Iran conflict driving fuel costs), and the potential impact of airline consolidation on its services revenue.…
GE
GE Aerospace
$366.70
Related headlines
Investment Opinion: Should I buy GE Today?
Based on the analysis, GE Aerospace is rated a Buy. The company's strong revenue growth (24.7% YoY), dominant market position, and robust profitability (operating margin 19.1%) support a positive outlook. The consensus Strong Buy rating and average target price of $404.90 imply ~8.1% upside, which is modest but reasonable given the stock's recent run-up. The valuation is rich at 37.75x trailing PE, but the PEG of 1.08 suggests fair value relative to growth. Key risks include geopolitical tensions, supply chain constraints, and potential earnings contraction. This Buy rating would be downgraded to Hold if revenue growth decelerates below 15% or if the stock trades above $420 without fundamental support. Conversely, it could be upgraded if the forward PE compresses below 35x or if services revenue growth accelerates further.
Sign up to view all
GE 12-Month Price Forecast
The AI assessment leans bullish given GE's strong fundamentals and market position, but confidence is medium due to valuation and macro risks. The company's ability to sustain high growth and manage external threats will be crucial. If growth continues and margins hold, the stock could outperform; however, any significant disruption could lead to a sharp correction. Monitoring supply chain and geopolitical developments is key.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on GE Aerospace's 12-month outlook, with a consensus price target around $404.90 and implied upside of +10.4% versus the current price.
Average Target
$404.90
0 analysts
Implied Upside
+10.4%
vs. current price
Analyst Count
—
covering this stock
Price Range
$347 - $455
Analyst target range
GE Aerospace has coverage from 21 analysts, with a consensus recommendation of 'Strong Buy' and a mean recommendation score of 1.45 (where 1 is Strong Buy and 5 is Sell). The average price target is $404.90, implying an upside of approximately 8.1% from the current price of $374.55. The distribution is heavily skewed toward bullish ratings, with no Sell ratings and only a few Hold ratings, indicating strong conviction among analysts.
Drowning in data?
Find the real signal!
Bulls vs Bears: GE Investment Factors
GE Aerospace presents a compelling growth story with accelerating revenue, dominant market position, and strong profitability, but faces significant valuation and macro risks. The bull case is supported by robust fundamentals and analyst conviction, while the bear case hinges on rich valuation, geopolitical tensions, and supply chain issues. Currently, the bull side has stronger evidence given the company's operational momentum and market leadership, but the key tension is whether the high multiple can be sustained if earnings growth decelerates or if external shocks hit the aviation industry. The stock's performance will largely depend on the resolution of these factors.
Bullish
- Strong Revenue Acceleration: Q1 2026 revenue grew 24.7% YoY to $12.39B, accelerating from 11.0% growth in Q2 2025. This momentum is driven by robust services demand, with service revenue of $6.35B outpacing product revenue of $2.65B, indicating a favorable mix shift toward high-margin aftermarket.
- Dominant Market Position: With nearly 80,000 engines installed globally and a leading narrowbody position via CFM joint venture, GE benefits from a massive recurring revenue base. This installed base provides long-term visibility and pricing power, underpinning the company's ability to generate stable cash flows.
- Strong Profitability Metrics: Operating margin improved to 19.1% in Q1 2026 (up from 19.0% in Q2 2025), and net margin reached 19.0%. ROE is an impressive 46.6%, reflecting efficient capital deployment and strong earnings generation relative to equity.
- Analyst Conviction High: With a Strong Buy consensus (mean score 1.45) and an average price target of $404.90, analysts see ~8.1% upside. No sell ratings and only a few holds indicate strong conviction in the company's growth trajectory.
Bearish
- Elevated Valuation: Trailing PE of 37.75x and forward PE of 41.27x are rich, with forward PE higher than trailing, implying expected earnings decline. PEG of 1.08 suggests fair value relative to growth, but the premium multiple leaves little room for error.
- Geopolitical and Fuel Cost Risks: The Iran conflict has driven oil prices to $119/barrel, raising fuel costs for airlines and potentially reducing flight hours, which directly impacts GE's services revenue. IATA warns of more carrier failures, which could lead to consolidation and reduced engine demand.
- Supply Chain Constraints: Persistent supply chain issues in aerospace could limit production and aftermarket parts availability, constraining revenue growth. This is a known industry-wide challenge that could delay engine deliveries and services.
- High Debt Levels: Debt-to-equity ratio of 1.10x indicates significant leverage. While manageable given strong cash flows, rising interest rates could increase financing costs and pressure margins.
GE Technical Analysis
GE Aerospace is in a strong uptrend, with the stock up 37.56% over the past year, significantly outperforming the S&P 500's 21.46% gain. The current price of $374.55 sits near the top of its 52-week range, at approximately 96.3% of the distance from the low of $263.80 to the high of $388.84. This positioning near highs indicates robust momentum and investor confidence, though it also suggests the stock may be vulnerable to profit-taking or overextension in the near term. The 1-year relative strength of 16.10% versus the S&P 500 underscores its leadership within the industrials sector.
Beta
1.37
1.37x market volatility
Max Drawdown
-21.0%
Largest decline past year
52-Week Range
$264-$389
Price range past year
Annual Return
+33.3%
Cumulative gain past year
| Period | GE Return | S&P 500 |
|---|---|---|
| 1m | +2.1% | +2.4% |
| 3m | +23.3% | +4.7% |
| 6m | +16.9% | +11.7% |
| 1y | +33.3% | +21.3% |
| ytd | +14.3% | +13.4% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
GE Fundamental Analysis
GE Aerospace's revenue is growing strongly, with Q1 2026 revenue of $12.39 billion, up 24.74% year-over-year, accelerating from the 11.0% growth seen in Q2 2025. The company's services segment, which accounts for the majority of revenue, is driving this growth, as evidenced by the $6.35 billion in service revenue reported in the latest quarter, compared to $2.65 billion in product revenue. This trend indicates a favorable mix shift toward higher-margin aftermarket services, which should support sustained earnings growth. However, the company faces potential headwinds from airline consolidation and geopolitical tensions that could impact flight hours and, consequently, services demand.
Quarterly Revenue
$12.4B
2026-03
Revenue YoY Growth
+24.7%
YoY Comparison
Gross Margin
36.1%
Latest Quarter
Free Cash Flow
$7.5B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is GE Overvalued?
Given that GE Aerospace is profitable, the primary valuation metric selected is the price-to-earnings (PE) ratio. The trailing PE is 37.75x, while the forward PE is 41.27x, indicating that the market expects earnings to decline slightly over the next year, which is unusual for a growth company. This could be due to anticipated margin pressures or increased investments. The PEG ratio of 1.08 suggests that the stock is reasonably valued relative to its expected earnings growth, but the forward PE being higher than trailing PE implies a potential earnings contraction, which warrants caution.
PE
37.7x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 3x~39x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
27.9x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks include a high debt-to-equity ratio of 1.10x, which could strain cash flows if interest rates rise. The company's reliance on services revenue (over 70% of total) makes it vulnerable to any downturn in flight hours, as seen with the Iran conflict driving fuel costs higher. Additionally, the forward PE of 41.27x implies expected earnings contraction, which could lead to multiple compression if not realized. Cash burn is not a concern given positive free cash flow of $7.46B TTM, but margin pressure from supply chain costs could erode profitability.
FAQ
The key risks include: 1) Geopolitical tensions, such as the Iran conflict, which can drive up fuel costs and reduce flight hours, impacting services revenue. 2) Supply chain constraints that could limit production and aftermarket parts availability. 3) High valuation (PE 37.75x) leaving little room for error. 4) High debt levels (D/E 1.10x) which could strain finances if interest rates rise. The most severe risk is a prolonged downturn in air travel, which would directly hit the core services business.
The 12-month forecast is moderately bullish. The base case (50% probability) sees the stock trading around $404.90 (analyst average target), while the bull case (30% probability) could push it to $455 (analyst high). The bear case (20% probability) could see it fall to $347 (analyst low) or lower. The most likely scenario is continued growth with some volatility, driven by strong demand and potential macro headwinds.
GE Aerospace is trading at a premium valuation with a trailing PE of 37.75x and forward PE of 41.27x, which is higher than the market average. The PEG ratio of 1.08 suggests it is fairly valued relative to its growth rate, but the forward PE being higher than trailing indicates expected earnings decline, which could be a red flag. Compared to its own history, the stock is near the high end of its valuation range. The market is pricing in continued strong growth, and any disappointment could lead to multiple compression.
GE Aerospace is a good buy for investors seeking exposure to the aerospace recovery, given its strong revenue growth (24.7% YoY) and dominant market position. The analyst consensus is Strong Buy with an average target of $404.90, implying ~8.1% upside. However, the stock is not cheap at 37.75x trailing PE, and risks from geopolitical tensions and supply chain issues could impact performance. It is suitable for long-term investors who can withstand short-term volatility.
GE Aerospace is better suited for long-term investment given its strong growth prospects and dominant market position. The stock has a beta of 1.366, indicating higher volatility than the market, which may not suit short-term traders. With a dividend yield of 0.44%, it offers minimal income, so capital appreciation is the primary driver. A minimum holding period of 3-5 years is recommended to ride out cyclicality and benefit from the aerospace recovery.