GE Stock Rises 65% This Year

GE Aerospace (NYSE: GE) has experienced a remarkable stock increase of approximately 65% this year, significantly outpacing the S&P 500, which has risen by 18%. Analysts project that the company’s revenues could grow over 20%, from a pro forma revenue of $35 billion in 2023 to around $42 billion by 2026. This growth is bolstered by a robust demand for its aftermarket services, particularly in engine servicing and aircraft maintenance, contributing to a substantial expansion in profit margins. In the second quarter, GE Aerospace reported an adjusted profit margin of 23.1%, up from 17.5% year-over-year, reflecting a 560 basis point increase. This margin improvement has played a crucial role in driving the stock price higher. The company anticipates adjusted earnings for 2024 to range between $3.95 and $4.20, a significant increase from the $2.95 reported in 2023. Projections suggest that adjusted earnings per share (EPS) could reach $7.20 by 2027, indicating a potential stock price growth of around 50%, pushing it above $250 in the next three years. Despite its recent gains, GE's stock performance has been mixed over the past few years, with returns of 10% in 2021, -11% in 2022, and 96% in 2023. In comparison, the S&P 500 saw returns of 27% in 2021, -19% in 2022, and 24% in 2023. While GE has shown significant recovery, it underperformed the S&P in 2021. Analysts suggest that examining GE's performance against its peers could provide further insights into its market position.