Dow Jones, Nasdaq, S&P 500 weekly preview: Big earnings week on tap after pullback
On Wednesday, RBC Capital Markets sustained its positive stance on GE Aerospace (NYSE:GE), maintaining an Outperform rating and a $220.00 price target for the company’s stock. The endorsement comes after GE Aerospace reported a first-quarter adjusted earnings per share (EPS) of $1.49, surpassing the consensus estimate of $1.27. The company’s adjusted revenue reached $9.0 billion, marking an 11% year-over-year increase, which aligned with market expectations. GE Aerospace’s operating profit of $2.15 billion exceeded consensus forecasts by 12%. With a market capitalization of $207 billion and a strong analyst consensus rating of 1.4, GE continues to demonstrate its position as a prominent player in the Aerospace & Defense industry. InvestingPro data shows 8 analysts have recently revised their earnings expectations upward for the upcoming period.
The company’s free cash flow (FCF) for the quarter was $1.44 billion, outperforming projections by 19%. Additionally, GE Aerospace has repurchased approximately $2 billion worth of shares during the quarter. A key highlight from the first-quarter results was the robust performance in services sales, which saw a 17% increase in the Commercial Engines Services (CES) segment. The company’s overall financial health score is rated as GOOD by InvestingPro, with particularly strong metrics in profitability and price momentum. For deeper insights into GE’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
GE Aerospace’s management has expressed confidence in their ability to navigate potential challenges, including a potential $500 million impact from tariffs. The company believes it can counteract this through cost reduction measures and pricing actions. This confidence has contributed to RBC Capital Markets’ decision to uphold its Outperform rating and $220 price target on GE Aerospace’s stock.
The financial performance and strategic maneuvers by GE Aerospace indicate a strong start to the year 2025. With the company’s effective handling of potential tariffs and continued share repurchases, investors and analysts alike will be closely monitoring GE Aerospace’s execution in the second half of 2025.
In other recent news, GE Aerospace reported impressive financial results for the first quarter of 2025. The company exceeded expectations with earnings per share of $1.49, compared to the forecasted $1.25, and revenue reaching $9.94 billion, surpassing the anticipated $9.14 billion. This performance was marked by a 38% increase in profit and a 60% rise in earnings per share year-over-year. UBS analyst Gavin Parsons (NYSE:PSN) responded to these results by raising the price target for GE Aerospace to $216, maintaining a Buy rating, citing the company’s ability to navigate challenges such as tariffs and supply chain issues. CEO Larry Culp advocated for a return to a tariff-free aerospace industry, emphasizing the benefits of a zero-duty regime for the U.S. aerospace sector, which currently enjoys a $75 billion annual trade surplus. Despite potential headwinds, the company remains optimistic about its guidance, anticipating low double-digit revenue growth for the year. The ongoing ramp-up of the LEAP engine and a robust commercial services backlog are expected to support future prospects.
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