On Monday, Deutsche Bank expressed a more optimistic stance on GE Aerospace (NYSE: GE), raising its price target to $209 from $195, while reaffirming its Buy rating on the company's shares. The adjustment follows a comprehensive update to the bank's financial model for GE, which now includes detailed bottom-up projections for various segments of the company's aerospace division.
The revised model specifically addresses original equipment (OE) revenue for LEAP OE, LEAP spares, and the GE90, GEnx, and GE9x series, both for OE and spares. These enhancements have led to an upward revision of the bank's earnings per share (EPS) and free cash flow (FCF) estimates for the years 2024 through 2026.
The report also touched on the potential for GE Aerospace to benefit from net price increases in the upcoming years. The increased price target of $209 reflects not only the higher financial estimates but also a reevaluation based on current market conditions.
Deutsche Bank's updated assessment suggests a significant 29% upside potential for GE Aerospace's stock, reinforcing the company's status as a top pick within the Aerospace & Defense (A&D) sector. This bullish outlook is predicated on the detailed revenue projections and anticipated financial performance improvements over the next few years.
In other recent news, General Electric (NYSE:GE)'s aerospace division, GE Aerospace, has been the subject of various financial analyst reports. The company's strategic repositioning following the spin-off of GE Vernova has led to increased focus on the aerospace industry. The financial forecasts for GE Aerospace are promising, with expectations of a 20-25% annual EPS/Free Cash Flow Per Share (FCFPS) growth through 2026. Revenue is expected to grow from $64,521 million in FY23A to $81,245 million in FY26E.
Several financial firms have updated their outlooks on GE Aerospace. UBS raised its price target to $201 while maintaining a Buy rating, citing the company's strong industry position. CFRA upgraded its rating from Hold to Buy, adjusting the stock price target to $181. BofA Securities increased its price target on the company's shares to $180, reaffirming its Buy rating.
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