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On Thursday, Bernstein analysts at Société Générale Group increased the price target for GE Aerospace (NYSE:GE) shares, lifting it to $254 from the previous $250 while reaffirming an Outperform rating on the stock. This aligns with the broader Wall Street sentiment, as InvestingPro data shows a strong analyst consensus rating of 1.4, with price targets ranging from $185 to $261. The adjustment follows GE Aerospace’s announcement of first-quarter earnings on April 22nd, which surpassed analyst expectations and confirmed the company’s 2025 financial outlook. The stock has demonstrated robust momentum, gaining over 16% year-to-date.
Douglas S. Harned, the Bernstein analyst, highlighted the company’s robust Q1 performance and the decision to uphold its guidance for 2025, which includes conservative estimates for tariff costs. The company’s strong position is reflected in its financial health, which InvestingPro rates as "GOOD" with impressive revenue growth of 8.82% over the last twelve months. Despite these costs being forecasted at $500 million after mitigation efforts such as cost reductions and pricing strategies, Harned sees the potential for further upside. The current guidance presupposes the reapplication of reciprocal tariffs following a 90-day suspension, a scenario the analyst views as unlikely, particularly regarding the 20% tariffs from the European Union.
Should the anticipated reciprocal tariffs not be reinstated, GE’s financial performance could see additional benefits. Moreover, Harned suggests that if tariffs are reduced in the coming years and GE maintains its projected operational improvements for 2025, the company could experience further positive momentum.
The continued strength of the aftermarket sector remains a critical factor for GE Aerospace’s growth, according to Harned’s commentary. This sector’s robustness is considered a key driver for the company’s ongoing expansion and financial success.
In other recent news, GE Aerospace has reported a strong financial performance for the first quarter of 2025, with earnings per share of $1.49, surpassing the consensus estimate of $1.27. The company’s revenue reached $9.94 billion, exceeding expectations of $9.14 billion, reflecting an 11% year-over-year increase. Analysts from RBC Capital Markets and UBS have maintained positive ratings on GE Aerospace, with RBC Capital Markets setting a $220 price target and UBS raising its target to $216. Additionally, TD Cowen reaffirmed its Buy rating with a $200 price target, highlighting the company’s strong aftermarket sales and supply chain improvements.
GE Aerospace’s management has expressed confidence in navigating potential challenges, such as a $500 million tariff impact, through cost reduction measures and pricing actions. The company’s order book grew by 31%, indicating strong demand, and its free cash flow for the quarter was $1.44 billion, outperforming projections by 19%. The company plans to implement mid-to-high single-digit percentage price increases on spare parts mid-year and temporary tariff surcharges.
CEO Larry Culp advocated for a return to a tariff-free aerospace industry, emphasizing the benefits of the 1979 Civil Aircraft Agreement. Despite potential headwinds from tariffs and supply chain issues, GE Aerospace remains optimistic about its growth prospects, supported by a robust commercial services backlog exceeding $140 billion. The company continues to focus on innovation and efficiency, with a strong emphasis on maintaining its guidance for low double-digit revenue growth for the year.
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