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GE Aerospace GE

Morningstar Rating
$157.38 +1.73 (1.11%)
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Company Report

GE Aerospace: Stand-Alone Jet Engine Maker Slightly Undervalued as Secular Demand Approaches

We are reinitiating coverage of GE Aerospace as a stand-alone business following the spinoff of General Electric’s power and wind turbine business as GE Vernova. We assign the jet engine maker a wide economic moat rating based on the technical complexity of its products and the specialized know-how it has to design, build, and service them, as well as engines' very long product cycles and some service contracts that imbue switching costs for GE Aerospace’s customers.

Price vs Fair Value

GE is trading within a range we consider fairly valued.
Price
$155.67
Fair Value
$833.00
Uncertainty
Medium
1-Star Price
$915.40
5-Star Price
$287.90
Economic Moat
Pmn
Capital Allocation
Ctsmxvqgw

Bulls Say, Bears Say

Bulls

Bears vastly underestimate the incremental profits GE will make from operating leverage as commercial aerospace fully recovers and its Leap engine aftermarket program enters its profitable phase.

Bears

Burgeoning demand for its engines could place GE Aerospace’s manufacturing and supply chain under disruptive strain, not just frustrating customers but hampering efficiency.

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News

Trading Information

Previous Close Price
$155.65
Day Range
$156.61157.45
52-Week Range
$76.80158.69
Bid/Ask
$157.38 / $157.45
Market Cap
$171.87 Bil
Volume/Avg
109,980 / 7.3 Mil

Key Statistics

Price/Earnings (Normalized)
55.99
Price/Sales
2.54
Dividend Yield (Trailing)
0.33%
Dividend Yield (Forward)
0.72%
Total Yield
1.06%

Company Profile

GE Aerospace is the global leader in designing, manufacturing, and servicing large aircraft engines, along with partner Safran in their CFM joint venture. With its massive global installed base of nearly 70,000 commercial and military engines, GE Aerospace earns most of its profits on recurring service revenue of that equipment, which operates for decades. GE Aerospace is the remaining core business of the company formed in 1892 with historical ties to American inventor Thomas Edison; that company became a storied conglomerate with peak revenue of $130 billion in 2000. GE spun off its appliance, finance, healthcare, and wind and power businesses between 2016 and 2024.
Sector
Industrials
Industry
Aerospace & Defense
Stock Style Box
Large Growth
Total Number of Employees
125,000

Competitors

Valuation

Metric
GE
RR.
RTX
Price/Earnings (Normalized)
55.9928.6319.97
Price/Book Value
6.232.24
Price/Sales
2.542.102.10
Price/Cash Flow
43.8125.2522.73
Price/Earnings
GE
RR.
RTX

Financial Strength

Metric
GE
RR.
RTX
Quick Ratio
0.790.690.63
Current Ratio
1.181.221.04
Interest Coverage
9.457.133.26
Quick Ratio
GE
RR.
RTX

Profitability

Metric
GE
RR.
RTX
Return on Assets (Normalized)
1.85%3.80%4.50%
Return on Equity (Normalized)
10.11%10.45%
Return on Invested Capital (Normalized)
6.27%147.07%7.93%
Return on Assets
GE
RR.
RTX
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Aerospace & Defense Industry Comparables

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Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
EADSY
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LMT
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BA
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GD
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TDG
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NOC
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BAESY
BAE Systems PLC ADRVvfbslpgfBrvhl$49.7 Bil
RYCEY
Rolls-Royce Holdings PLC ADRBrtkdmnTxnrk$42.0 Bil

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