Track market-moving stories before they get noisy

GE Aerospace (GE.N) has acted to contain shortages of precision jet engine parts while securing valuable technology by breaking ​into the inner circle of castings manufacturers with a $12 billion purchase of Consolidated Precision Products.

Buying CPP, the world's third-largest maker ‌of the metallic components needed for engine turbine blades, is the latest step in a years-long effort to strengthen aerospace supply chains.

GE Aerospace CEO Larry Culp, announcing his largest acquisition since turning round and splitting industrial giant General Electric, called the capacity "mission-critical".

The deal illustrates a shift from winning new orders to production strategy in the overstretched aerospace industry, whose biggest ​challenge is delivering on seven- to10-year order books.

CASTINGS CHOKEPOINT SINCE COVID TIMES
Castings — parts made from liquid metal that are difficult to mass-produce — and ​forgings, which are made from solid metal and just as hard to make, have been one of the industry's ⁠most intractable chokepoints since the COVID-19 pandemic.

GE's competitors are also seeking to address the issue. Pratt & Whitney (RTX.N) said last year it was adding an in-house ​casting foundry in North Carolina, while Rolls-Royce (RR.L) is expanding an existing plant in Britain.

Based on age-old techniques involving wax replicas — and relying on avant-garde technology ​to withstand temperatures above their melting point — turbine blades stand at the pinnacle of costly aerospace manufacturing, according to analysts.

They have also been at the centre of wider production snags, fuelling tensions between the engine industry and airlines.

Decades of investment and specialist knowledge have made the handful of players difficult to imitate and kept prices high.

"It's the black art of ​manufacturing, which has always been a huge barrier," said AeroDynamic Advisory Managing Director Kevin Michaels.

"It is the hardest thing to do...You might have to ​throw away half or more of what you make."

CPP is one of four major global suppliers for such castings and supplies a quarter of GE's needs, according to Jefferies.

GE ‌has courted ⁠the Ohio-based firm for years as it sought an insurance policy against any disruption from larger suppliers Howmet (HWM.N) or Precision Castparts Corp, industry sources said. Neither company had any immediate comment.

DEAL WILL FACE ANTITRUST SCRUTINY
Expansion is not solely driven by bottlenecks.

GE plans to use its LEAN production system to improve efficiency and unlock greater rewards. Analysts say a tone was set by the turnaround and IPO of UK peer Doncasters (DPC.N).

Castings and forgings are also at the centre of ​a strategic contest between developers of ​the next generation of engines. China ⁠is also pursuing a place in the market, Michaels said.

"They (GE) are expecting a return that allows them to make this work financially, but it also allows them to own a piece of the supply chain that is critical ​to the future of engine performance," Jerrold Lundquist, managing director of advisory firm The Lundquist Group, said.

Broader competition ​for advanced metal parts ⁠was highlighted last week by Elon Musk who posted that plans by SpaceX to handle separate castings in-house would be a "profound game-changer".

Deals like GE's are not without risk. They include scaring away rivals who also buy from CPP, or losing favour with large suppliers such as Howmet with which GE also does business.

The ⁠deal will in ​addition face antitrust scrutiny. GE is expected to point to its existing ownership of Italian ​gear maker Avio Aero — a major supplier to Pratt & Whitney, which declined to comment.

"I would expect GE to be required to divest certain facilities, making the integration process and any related ​carve-outs quite complex," said Matteo Peraldo, aerospace and defence partner at U.S.-based AlixPartners.

CINCINNATI, Sept. 08, 2026 (GLOBE NEWSWIRE) --

Investing in castings capacity to support strong demand across commercial engines, aftermarket and defense$11.75 billion transaction, expected to be accretive-a) to adjusted EPS* and free cash flow* in the first yearStrong near and long-term value creation for customers and shareholders GE Aerospace (NYSE:GE) announced today that it has signed an agreement to acquire Consolidated Precision Products (CPP), a leading manufacturer of highly engineered castings, from private investment firms Warburg Pincus and Berkshire Partners. 

GE Aerospace Chairman and CEO H. Lawrence Culp, Jr., said, “Investing in mission-critical casting capacity is needed to support the strong simultaneous demand across commercial engines, aftermarket and defense. By combining GE Aerospace’s technology capabilities and FLIGHT DECK with CPP’s manufacturing experience, we expect to expand capacity, improve performance and accelerate new engine technologies for the current fleet and next-generation platforms.”

CPP, headquartered in Cleveland, Ohio, manufactures highly engineered castings and sub-assemblies primarily for the commercial aerospace and defense markets. Founded in 1991, CPP is one of the world's largest producers of investment and precision sand castings, producing complex super alloy, titanium, aluminum, magnesium and steel castings for a variety of leading commercial and military aircraft, weapon systems, commercial and regional/business jets, helicopters and industrial gas turbines. CPP has a global team of ~6,600 employees across more than 20 facilities. GE Aerospace has been a CPP customer for over fifteen years.

Culp added, “We will leverage FLIGHT DECK to drive process and quality improvements, supporting higher output, and integrate design and manufacturing to bring engine technologies to market faster for our customers. These improvements also will ensure manufacturing readiness to deploy enhanced airfoil technology for a more reliable ramp.”

CPP CEO James Stewart, said, “GE Aerospace has been a great partner to CPP for many years, and we are excited to further strengthen this long‑standing relationship. As we advance our position as an industry leader in castings, GE Aerospace has expressed strong enthusiasm for supporting our continued growth and expanded vision. Together, we look forward to delivering meaningful value and advancing the success of both organizations.”

Warburg Pincus Managing Director Dan Zamlong, said, “We are incredibly proud of the platform we have built in partnership with Berkshire Partners and CPP’s talented management team. CPP has been transformed into a leading precision casting company in the industry, with significant investments in its operations, technology, quality systems and talent, while expanding its ability to support customers across the commercial aerospace, defense, and power generation markets.”

Berkshire Partners Managing Director Blake Gottesman said, “Berkshire Partners is grateful to have partnered with CPP’s management team and Warburg Pincus during a critical chapter of the company’s growth. Together, we have strengthened CPP’s leadership in the castings industry, and we are excited for the company’s continued success as part of GE Aerospace.”

Transaction Details
This transaction will deliver strong near and long-term value creation for customers and shareholders:

Purchase price of $11.75 billion to be financed with $7 billion in cash, with the remainder in new debtValues CPP at ~18x 2027 EBITDA including expected net synergies, multiple of ~26x without The acquisition is expected to be accretive-a) to adjusted EPS* and free cash flow* in the first yearNo change to GE Aerospace’s capital allocation plans  GE Aerospace and CPP are committed to a disciplined, well-planned integration. The transaction is expected to close in the second half of 2027 and will be subject to regulatory approvals and other customary closing conditions.

Advisors
Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as lead legal counsel to GE Aerospace. Evercore and PJT Partners are the lead financial advisors to GE Aerospace on the transaction. Morgan Stanley & Co. LLC and Guggenheim Securities, LLC are serving as financial advisors and Cleary Gottlieb is serving as legal counsel to CPP on the transaction.

About GE Aerospace
GE Aerospace is a global aerospace propulsion, services, and systems leader with an installed base of approximately 50,000 commercial and 30,000 military aircraft engines. With a global team of approximately 57,000 employees building on more than a century of innovation and learning, GE Aerospace is committed to inventing the future of flight, lifting people up, and bringing them home safely. Learn more about how GE Aerospace and its partners are defining flight for today, tomorrow and the future at www.geaerospace.com.

About Warburg Pincus
Warburg Pincus LLC is the pioneer of private equity global growth investing. A private partnership since 1966, the firm has the flexibility and experience to focus on helping investors and management teams achieve enduring success across market cycles. Today, the firm has more than $105 billion in assets under management, and more than 225 companies in their active portfolio, diversified across stages, sectors, and geographies. Warburg Pincus has been an active investor in the aerospace & defense and industrial technology sectors with current and former investments including Accelya, Aquila Air Capital, CAMP Systems, Duravant, Extant Aerospace, Infinite Electronics, Inmarsat, iNRCORE, Quest Global, Sundyne, Topcast, TransDigm, TRIUMPH, and Wencor Group. Warburg Pincus has invested in more than 1,100 companies across its private equity, real estate, and capital solutions strategies.

The firm is headquartered in New York with more than 15 offices globally. For more information, please visit www.warburgpincus.com or follow us on LinkedIn and YouTube.

About Berkshire Partners
Berkshire Partners is a 100% employee-owned, multi-sector specialist investor in private and public equity, with a focus on North American-based, middle-market companies. For more than four decades, the firm's private equity team has invested in well-positioned, growing companies across services, healthcare, industrials, and technology. Berkshire is currently investing from its Fund XI, with approximately $7.8 billion in commitments. Since inception, Berkshire Partners has made more than 140 private equity investments and has consistently worked in close partnership with management teams to build enduring businesses. Stockbridge, the firm's public equity group, was founded in 2007 and manages a concentrated portfolio seeking attractive long-term investments. For additional information, visit www.berkshirepartners.com.

Caution concerning forward-looking statements - This document contains "forward-looking statements" – that is, statements related to future events that by their nature address matters that are, to different degrees, uncertain. Uncertainties related to this transaction, including expected timing and structure, the ability of the parties to satisfy regulatory and other closing conditions and the expected benefits of the transaction, or other matters as described in our SEC filings may cause our actual future results to be materially different than those expressed in our forward-looking statements; see www.geaerospace.com/investor-relations/important-forward-looking-statement-information as well as our annual reports on Form 10-K and quarterly reports on Form 10-Q for additional details. We do not undertake to update our forward-looking statements. This document also includes certain forward-looking projected financial information that is based on current estimates and forecasts. Actual results could differ materially.

*Non-GAAP Financial Measure
(a- excluding one-time costs and deal related amortization

GE Aerospace (GE.N) said on Tuesday it would buy castings supplier Consolidated Precision Products for $11.75 billion, bringing a key part of its ‌engine supply chain in-house as it races to expand production capacity.

Supply-chain constraints have made it harder for engine makers to keep pace with strong demand for new engines and aftermarket parts and repairs. While conditions have improved, castings remain a key pressure point for the industry.

For GE Aerospace, the deal aims to tackle that constraint directly. The company has a large backlog stretching into the next decade ​and is looking to secure enough capacity to meet demand already on its books.

The acquisition is GE Aerospace's largest since it became a standalone company ​in 2024.

"Investing in mission-critical casting capacity is needed to support the strong simultaneous demand across commercial engines, aftermarket and defense," GE Aerospace ⁠CEO Larry Culp said.

CASTINGS CONSTRAINT
CPP is one of the world's largest makers of precision sand castings, complex metal parts made by pouring molten material into molds.

It is a ​key supplier to GE's LEAP and GEnx commercial engines and makes parts for nearly every major current-generation commercial aircraft program. About 70% of its revenue comes from commercial and ​defense engines.

GE said it expects CPP to generate about $2 billion in revenue in 2027.

GE also expects its demand for airfoils to rise more than 30% by 2030 from 2026 levels. Airfoils include turbine blades and vanes that operate in some of the hottest parts of an engine.

That demand is coming from two fronts. Culp has said GE and its suppliers face competing demands from aircraft ​makers seeking more new engines and airlines needing more parts and repairs. The same supply chain serves both markets, requiring suppliers to keep raising output to meet demand ​on both fronts.

The announcement of the deal comes days after SpaceX (SPCX.O) CEO Elon Musk touted his company's ambitions to manufacture turbine blades to cater to its own power needs.

GE said it expects to ‌raise CPP's ⁠output by improving factory yields and machine use while cutting scrap and rework.

The CEO of leasing company AerCap (AER.N), Aengus Kelly, said the deal was important because engines remain a major constraint on aircraft production.

"You want to be in control of that critical part of your supply chain," Kelly told CNBC of castings and forgings, adding that an engine maker such as GE could take a longer-term view of investments needed to expand capacity.

Vertical Research analyst Robert Stallard said the deal made strategic sense given continued tightness in ​engine castings.

The acquisition could raise questions for ​other aerospace companies that rely on CPP ⁠for parts. Stallard said it remained to be seen whether the deal would affect CPP's non-GE customers.

RTX (RTX.N), whose Pratt & Whitney unit buys engine components from CPP and competes with GE, declined to comment. Howmet Aerospace (HWM.N), a major rival to CPP in aerospace castings, ​also declined to comment.

GE Aerospace shares were little changed in afternoon trading, while Howmet fell about 8%.

MORE THAN CAPACITY
GE also ​sees the deal as ⁠a way to bring new engine technology into production faster.

The company said its enhanced airfoil technology can lower metal temperatures inside engines, helping improve durability and efficiency. The technology can be used on the LEAP as well as future engines.

By bringing airfoil design and manufacturing closer together, GE expects to shorten development times and make it easier to ramp up production ⁠of new ​parts.

The deal values CPP at about 26 times its expected 2027 core profit before benefits GE expects ​from combining the businesses, falling to about 18 times after including them.

GE will fund $7 billion of the purchase with cash and the rest with new debt. The deal is expected to close in the second half ​of 2027.

GE Aerospace (GE) is seeing a modest increase in its stock price following its announcement to acquire Consolidated Precision Products (CPP) for $11.75 billion.

8.9.2026 14:40, GE

Americký výrobce leteckých motorů GE Aerospace oznámil akvizici Consolidated Precision Products (CPP) od Warburg Pincus a Berkshire Partners za 11,75 mld. USD. GE Aerospace je zákazníkem CPP již více než 15 let. Dokončení transakce se očekává ve druhém pololetí roku 2027 a podléhá schválení regulatorními orgány.

Podle generálního ředitele GE Aerospace H. L. Culpa Jr. jsou investice do výrobních kapacit potřebné pro to, aby společnost dokázala uspokojit současnou silnou poptávku v oblasti motorů pro komerční letectví i v oblasti obranného průmyslu.

Podle prohlášení společnosti bude akvizice financována částkou 7 mld. USD v hotovosti, přičemž zbývající část pokryje nový dluh. Transakce oceňuje CPP přibližně na 18násobek EBITDA očekávaného v roce 2027 po započtení předpokládaných čistých synergií. Bez jejich započtení odpovídá ocenění přibližně 26násobku EBITDA.

Vývoj akcie Akcie General Electric Aerospace (GE) v předburzovní fázi obchodování posilují o 0,43 % na 338,56 USD.

Zdroj: Bloomberg, GE Aerospace

Jan Prokeš
Fio banka, a.s.
Prohlášení

Key Takeaways GE Aerospace's Commercial Engines & Services revenues rose 27% year over year to $9.73 billion.GE saw segment orders rise 18% to $12.93 billion as LEAP deliveries increased 24% in the quarter.GE expects adjusted Commercial Engines & Services revenues to grow about 20% in 2026. GE Aerospace (GE - Free Report) is experiencing persistent strength in its Commercial Engines & Services segment. The company continues to experience strong orders for LEAP, GEnx & GE9X engines and services, supported by growth in air traffic, fleet renewal and expansion activities.

In the first half of 2026, the company secured several major engine orders and service agreements. GE Aerospace secured GEnx engine orders from United Airlines and Delta Air Lines for their Boeing 787 Dreamliners, while CFM International (the 50/50 joint venture between GE and Safran Aircraft Engines) extended its partnership with American Airlines for LEAP engine deliveries. CFM International also entered into a Memorandum of Understanding with IndiGo for delivery of more than 1,000 LEAP-1A engines.

GE Aerospace clinched an order from Jet2 plc to supply CFM LEAP-1A engines for the latter’s Airbus A321neo aircraft. The company also secured an order from Copa Airlines for up to 120 LEAP-1B engines to power the airline's expanding Boeing 737 MAX fleet. GE further signed a long-term materials agreement to support Ryanair's fleet of approximately 2,000 CFM56 and LEAP engines.

Driven by strength across its business, revenues from the Commercial Engines & Services segment increased 27% year over year to $9.73 billion in second-quarter 2026. Equipment revenues in the segment advanced 30%, supported by unit volume growth of 26%, including a 24% increase in LEAP deliveries. Total orders in the segment rose 18% year over year to $12.93 billion. For 2026, adjusted revenues from the Commercial Engines & Services segment are expected to grow about 20%.

GE's Peers in the Aerospace MarketAmong its major peers, Howmet Aerospace Inc. (HWM - Free Report) is benefiting from persistent strength in the commercial aerospace market. Revenues from Howmet’s commercial aerospace market increased 28% year over year in the second quarter of 2026, constituting 53% of its business. Also, in 2025, revenues from the market increased 12% year over year.

RTX Corporation (RTX - Free Report) is also witnessing solid momentum in the commercial aerospace market, with growth in aftermarket and OEM verticals. RTX reported 16% organic sales growth in the second quarter, driven by solid momentum in the Collins Aerospace and Pratt & Whitney segments. Rising aircraft utilization and demand for sustainable technologies bode well for RTX Corp.’s growth.

GE's Price Performance, Valuation and EstimatesShares of GE Aerospace have gained 4.2% in the past three months against the industry’s 0.7% decline.

Image Source: Zacks Investment Research

From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 38.40X, above the industry’s average of 31.21X. GE Aerospace carries a Value Score of D.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for GE’s 2026 earnings has gone up 5.1% over the past 60 days.

Image Source: Zacks Investment Research

The company currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the latest trading session, GE Aerospace (GE - Free Report) closed at $354.39, marking a +1.39% move from the previous day. The stock outperformed the S&P 500, which registered a daily loss of 0.02%. Elsewhere, the Dow saw a downswing of 0.21%, while the tech-heavy Nasdaq depreciated by 0.08%.

The industrial conglomerate's shares have seen a decrease of 3.86% over the last month, not keeping up with the Aerospace sector's loss of 2.92% and the S&P 500's gain of 3.67%.

The investment community will be closely monitoring the performance of GE Aerospace in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $1.99, reflecting a 19.88% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $12.57 billion, indicating a 11.17% increase compared to the same quarter of the previous year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $7.86 per share and a revenue of $50.65 billion, signifying shifts of +23.39% and +19.69%, respectively, from the last year.

Investors should also take note of any recent adjustments to analyst estimates for GE Aerospace. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.08% downward. As of now, GE Aerospace holds a Zacks Rank of #3 (Hold).

Digging into valuation, GE Aerospace currently has a Forward P/E ratio of 44.46. Its industry sports an average Forward P/E of 22.86, so one might conclude that GE Aerospace is trading at a premium comparatively.

We can also see that GE currently has a PEG ratio of 2.57. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Aerospace - Defense was holding an average PEG ratio of 1.71 at yesterday's closing price.

The Aerospace - Defense industry is part of the Aerospace sector. Currently, this industry holds a Zacks Industry Rank of 67, positioning it in the top 28% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

Key Takeaways GE Aerospace's Q2 operating profit rose 18% to $2.75B, while margin fell 130 bps to 21.7%.GE's cost of sales jumped 26.7% to $8.7B, with R&D expenses rising 28.1% to $460M.GE Aerospace raised 2026 operating profit guidance to $10.55B-$10.75B, implying 17% growth at midpoint. GE Aerospace (GE - Free Report) recorded an operating profit of $2.75 billion (on a non-GAAP basis) in second-quarter 2026, an increase of 18% year over year. However, the company's operating profit margin (non-GAAP) was 21.7%, reflecting a decrease of 130 basis points (bps). The decline was attributable to the impacts of growth investments and cost inflation.

In the second quarter, GE’s cost of sales (comprising costs of equipment and services sold) surged 26.7% year over year to $8.7 billion. While selling, general and administrative expenses increased 10.9% to $1.1 billion, research and development expenses rose 28.1% to $460 million. The company is incurring high costs and expenses related to certain projects and increased production activities.

Nevertheless, GE Aerospace’s solid momentum across both commercial and defense aerospace sectors, driven by a strong pipeline of projects, is expected to drive its growth. Also, its focus on effective cost management and backlog conversion is expected to improve its margin performance. For 2026, the company expects to generate operating profit (non-GAAP) in the range of $10.55-$10.75 billion compared with the previous forecast of $9.85-$10.25 billion. The updated guidance indicates year-over-year growth of 17% at the mid-point.

For the year, GE expects its top-line and margin performance to benefit from higher LEAP engine deliveries, strong demand for aftermarket services and focus on operational execution.

Peer’s Margin PerformanceAmong its major peers, RTX Corporation’s (RTX - Free Report) total costs and expenses increased 12.8% year over year to $21.96 billion in second-quarter 2026. Despite the rise in costs, RTX Corp.’s consolidated adjusted segment margin expanded 40 basis points to 12.4% in the quarter. RTX is benefiting from rising aerospace deliveries, growing aftermarket revenues and declining geared turbofan (GTF) engine-related cash costs.

Textron Inc.’s (TXT - Free Report) total costs and expenses rose 3.2% year over year in second-quarter 2026. Textron’s net income margin declined 10 bps to 6.5% in the quarter. If pricing and volume growth continue to be offset by mix and execution costs, Textron’s earnings may grow at a slower pace than revenues.

GE's Price Performance, Valuation and EstimatesShares of GE Aerospace have gained 10.5% in the past three months against the industry’s decline of 1%.

Image Source: Zacks Investment Research

From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 41.19X, above the industry’s average of 31.99X. GE Aerospace carries a Value Score of D.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for GE’s earnings has increased for both 2026 and 2027 over the past 60 days.

Image Source: Zacks Investment Research

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?

Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about GE Aerospace (GE - Free Report) .

GE currently has an average brokerage recommendation (ABR) of 1.45, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 22 brokerage firms. An ABR of 1.45 approximates between Strong Buy and Buy.

Of the 22 recommendations that derive the current ABR, 17 are Strong Buy and two are Buy. Strong Buy and Buy respectively account for 77.3% and 9.1% of all recommendations.

Brokerage Recommendation Trends for GE

Check price target & stock forecast for GE here>>>

While the ABR calls for buying GE, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.

Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.

This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.

Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.

Zacks Rank Should Not Be Confused With ABRAlthough both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.

Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.

It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.

In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.

Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.

There is also a key difference between the ABR and Zacks Rank when it comes to freshness. When you look at the ABR, it may not be up-to-date. Nonetheless, since brokerage analysts constantly revise their earnings estimates to reflect changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in predicting future stock prices.

Is GE Worth Investing In?In terms of earnings estimate revisions for GE, the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $7.86.

Analysts' steady views regarding the company's earnings prospects, as indicated by an unchanged consensus estimate, could be a legitimate reason for the stock to perform in line with the broader market in the near term.

The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for GE. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

It may therefore be prudent to be a little cautious with the Buy-equivalent ABR for GE.

Key Takeaways GE Aerospace repurchased $4.2 billion of shares and paid $873 million in dividends in first-half 2026.GE Aerospace raised its dividend 30.6% to 36 cents per share and has a $20 billion buyback authorization.GE Aerospace expects 2026 free cash flow of $8.9-$9.2 billion, up from its prior $8.0-$8.4 billion view. GE Aerospace (GE - Free Report) is a leading designer, developer and producer of jet engines, components and integrated systems for military, commercial and business aircraft. Its products and services range from jet engines like LEAP, GE9X & GEnx, airframes, engine gear, and transmission components and services, among others.

The company’s commitment to reward its shareholders through dividends and share buybacks is encouraging. In the first half of 2026, it bought back shares for $4.2 billion and paid dividends of $873 million, up 26.9% year over year, to its shareholders. In addition, in 2025, it rewarded its shareholders with a dividend payment of $1.45 billion and repurchased shares for $7.55 billion.  Following the first quarter of 2026, share repurchases are being made under the new $20 billion authorization approved in December 2025.

GE Aerospace raised its dividend by 30.6% to 36 cents per share in February 2026. It expects to generate a free cash flow of $8.9-$9.2 billion in 2026, much higher than $8.0-$8.4 billion guided previously. Also, the company previously announced its plans to boost total shareholder returns by 20% to approximately $24 billion from 2024 to 2026, through a mix of dividends and share repurchases.

The company’s strong liquidity also supports its shareholder-friendly policies. Exiting the second quarter, GE’s cash, cash equivalents and restricted cash were $9.3 billion, much higher than the short-term borrowings of $2 billion. This implies that the company has sufficient cash to meet its short-term debt obligations.

Do GE’s Peers Focus on Returning Capital to Shareholders?3M Company (MMM - Free Report) rewarded its shareholders with dividend payouts of $0.8 billion and $3 billion in buybacks in the first six months of 2026. Exiting the second quarter of 2026, 3M had approximately $1.8 billion remaining under the share repurchase program. Also, in February 2026, 3M hiked its quarterly dividend by 6.8%.

Howmet Aerospace (HWM - Free Report) remains focused on rewarding its shareholders handsomely through dividends and share buyback programs. In the first six months of 2026, Howmet paid dividends of $97 million, and in July 2026, it hiked its dividend by 17% to 14 cents per share (annually: 56 cents). On a year-to-date basis through July, HWM repurchased shares worth $800 million. As of Aug. 6, 2026, Howmet’s total share repurchase authorization available was $697 million.

GE's Price Performance, Valuation and EstimatesShares of GE Aerospace have gained 3% in the past six months against the industry’s decline of 10%.

Image Source: Zacks Investment Research

From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 40.15X, above the industry’s average of 33.51X. GE Aerospace carries a Value Score of D.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for GE’s earnings has increased for both 2026 and 2027 over the past 60 days.

Image Source: Zacks Investment Research

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

At $369.43, GE Aerospace (NYSE:GE | GE Price Prediction) looks fully valued, even as Wall Street consensus stays firmly bullish on the aviation giant. The stock has hit a wall of premium multiples and supply-side execution risk, arguing for patience over fresh buying.

GE Aerospace is a pure-play jet engine business dominating the commercial narrow-body market through its CFM joint venture, with roughly 50,000 commercial and 30,000 military engines installed. That footprint drives a services annuity that produced $3 billion of free cash flow in the June quarter. Shares are up 38.63% over the past year and 498.99% across five years, a rerating that has taken the multiple from cyclical to structural.

Why the Bull Camp Is Not Backing Down
The operational story is flawless. GE printed five consecutive EPS beats, with Q2 2026 adjusted EPS of $2.02 against a $1.8565 consensus and revenue of $13.349 billion, up 21.1% year over year. Management raised full-year guidance to $7.65 to $7.85 EPS and $8.9 to $9.2 billion in free cash flow.

Backlog sits above $210 billion, the LEAP-1B durability kit is certified with a projected two-fold improvement in time-on-wing, and CEO Larry Culp said “demand could evolve from here, but it’s been far more resilient than maybe many of us would have expected.” That is why 86% of covering analysts carry a bullish rating.

Why the Multiple Is Doing the Heavy Lifting
At the current price, GE trades at roughly 43x trailing earnings and 47x to 48x forward guidance, leaving little room for operational hiccups. The bear case starts with the supply chain. Spare parts delinquencies rose 20% sequentially in Q2, MRO capacity is “really oversubscribed”, and Culp framed it plainly: “It’s much more supply side challenge than it is demand.”

Margins are compressing where growth is loudest. CES margins fell 160 basis points to 27.3% in Q2 on installed engine mix and GE9X investment. CFO Rahul Ghai warned that GE9X losses peak by 2028. Insider activity leans the same direction, with senior VPs Mohamed Ali and Riccardo Procacci selling into strength near $347 to $353.

Why Patience Beats Conviction Here
The case for patience is straightforward. Fundamentals are excellent, but the stock is priced for that excellence. The internal fair-value model pegs GE at $397.06, only 7.48% above spot, and the base-case one-year scenario returns the same figure. Shares sit just 4% below the 52-week high of $388.84, and margin expansion is not expected to reaccelerate until 2028.

The Data Behind the Verdict
GE trades at $369.43 against a Wall Street consensus target of $404.90, implying roughly 9.6% upside. Twenty-two analysts cover the name: 3 Strong Buy, 16 Buy, 1 Hold, 0 Sell, and 2 Strong Sell. Analyst targets are one data point among many, especially when the model’s fair value already sits below consensus.

The trailing P/E is 43 with a forward multiple of 47, a PEG of 5.41, and price-to-sales at 7.55. Year to date, GE is up 20.26% versus the S&P 500’s 13.14%, and its one-year gain of 38.63% nearly doubles the index’s 20.09%.

Why Waiting Is the Right Call at $369
At $369.43, GE Aerospace looks fairly valued. The bull thesis and current price already align. Buying today requires believing the LEAP ramp accelerates through supply constraints, that GE9X losses shrink faster than Ghai’s 2028 guide, and that a 47x forward multiple holds while margins compress. That is a lot to underwrite in one trade.

The sell case has its own problems. Backlog visibility of $210 billion, over 95% of Q3 spare parts revenue already booked, and a raised free cash flow floor of $8.9 billion put a real bid under the stock on any pullback. Shorting a company beating and raising every quarter is a low-percentage trade.

The upgrade trigger is a pullback into the low $300s or evidence that CES margins have stopped compressing. The downgrade trigger is a supply chain miss forcing a guidance cut, or LEAP durability retrofits slipping past early 2027. Watch shop visit turnaround times, spare parts delinquencies, and the GE9X margin trajectory quarter by quarter.

GE Aerospace is a great business at a demanding price. For current holders, the setup favors patience over adding at these levels while waiting for a better entry.

Contact [email protected] for any questions or corrections.

Key Takeaways GE Aerospace's Defense & Propulsion revenues rose 16% in Q2 after growing 19% in the first quarter.GE secured key defense contracts while segment orders climbed 12% and operating profit rose 18%.GE expects Defense & Propulsion revenues to grow in the low-double-digit range in 2026. GE Aerospace (GE - Free Report) is witnessing strong momentum in its Defense & Propulsion Technologies segment. After experiencing growth of 19% in first-quarter 2026, revenues from the segment increased 16% year over year in the second quarter. The surge in revenues was driven by the growing popularity of GE’s propulsion & additive technologies, critical aircraft systems and aftermarket services in the defense sector.

Some of the notable contracts secured by the company include a contract from Turkish Aerospace Industries to continue integrating its F404 engine into Türkiye's Hurjet jet trainer. It also clinched a deal from Boeing Defence UK for the extension of support services for T700-GE-T701D engines. GE will be responsible for providing logistics management, repair, maintenance and technical support services for these turboshaft engines. Apart from this, it entered into a multi-year partnership with Palantir Technologies Inc. (PLTR) to improve the fleet management and operational readiness of the U.S. Air Force’s military aircraft.

The strong pipeline of projects boosted the Defense & Propulsion Technologies segment’s orders, which increased 12% in the second quarter on a year-over-year basis. The segment’s operating profit grew 18% to $475 million.

Backed by favorable geopolitical developments and consistent government support, the company’s Defense & Propulsion Technologies segment is well-placed for growth in the quarters ahead. For 2026, GE expects revenues from the Defense & Propulsion Technologies segment to increase in the low-double-digit range.

GE's Peers in the Defense MarketHowmet Aerospace Inc. (HWM - Free Report) is benefiting from strong momentum in its defense aerospace market. After experiencing growth of 10% in first-quarter 2026, revenues from the defense aerospace market increased 11% year over year in the second quarter. The surge in revenues was driven by the solid demand for engine spares, particularly related to the F-35 program, and an increase in orders for legacy fighter jet spares.

Northrop Grumman’s (NOC - Free Report) defense market is playing an important role in driving its overall growth. In second-quarter 2026, revenues from Northrop’s Defense Systems segment climbed 5.1% year over year to $2.09 billion. This improvement was driven by the continued ramp-up of the Sentinel program, as well as the higher volume of tactical solid rocket motor programs and the Integrated Battle Command System portfolio.

GE's Price Performance, Valuation and EstimatesShares of GE Aerospace have gained 25.3% in the past three months compared with the industry’s 11.2% growth.

Image Source: Zacks Investment Research

From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 42.68X, above the industry’s average of 34.39X. GE Aerospace carries a Value Score of D.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for GE’s 2026 and 2027 earnings has increased over the past 60 days.

Image Source: Zacks Investment Research

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Key Takeaways Commercial Engines & Services revenues rose 27% to $9.73 billion in the second quarter of 2026.Services grew 26%, spare parts topped 25% growth and equipment revenues advanced 30%.Major LEAP, GEnx and GE9X orders support an expected 20% segment revenue gain in 2026. The strongest driver of GE Aerospace’s (GE - Free Report) business at the moment is the Commercial Engines & Services segment. In the second quarter of 2026, revenues from the Commercial Engines & Services segment increased 27% year over year to $9.73 billion.

The gain was driven by services growth of 26%, with internal shop visit revenues up 25%. Spare parts revenues increased more than 25%, reflecting robust aftermarket demand. Equipment revenues in the segment advanced 30%, supported by unit volume growth of 26%, including a 24% increase in LEAP deliveries. Total orders in the segment rose 18% year over year to $12.93 billion.

A growing installed base and higher utilization of engine platforms, particularly in the commercial aerospace sector, have set the stage for the company’s long-term growth. GE continues to experience strong orders for LEAP, GEnx & GE9X engines and services, supported by growth in air traffic, fleet renewal and expansion activities.

In the first half of 2026, the company secured several major engine orders and service agreements. GE recently clinched an order from Jet2 plc to supply CFM LEAP-1A engines for the latter’s Airbus A321neo aircraft. It secured an order from Copa Airlines for up to 120 LEAP-1B engines to power the airline's expanding Boeing 737 MAX fleet.

It also entered into a long-term materials agreement to support Ryanair’s fleet of about 2,000 CFM56 and LEAP engines. It also secured orders for GEnx engines from United Airlines and Delta Air Lines for their Boeing 787 Dreamliners.

With commercial aircraft programs expected to continue benefiting from the strength in air travel, GE is poised to maintain strong demand momentum in the quarters ahead. For 2026, adjusted revenues from the Commercial Engines & Services segment are expected to experience growth of about 20%.

GE's Peers in the Aerospace MarketAmong its major peers, RTX Corporation (RTX - Free Report) is benefiting from strength in the commercial aerospace market, with growth in both aftermarket and OEM verticals. RTX reported 16% organic sales growth in the second quarter, driven by solid momentum in the Collins Aerospace and Pratt & Whitney segments. Rising aircraft utilization and demand for sustainable technologies are supporting RTX Corp.’s growth.

Another peer, Textron Inc.’s (TXT - Free Report) Aviation business unit is benefiting from improving commercial air passenger traffic. Strong commercial aircraft demand and aftermarket activity contributed to Textron Aviation unit’s revenue growth of 1% in the second quarter. Thanks to growing air travel, Textron has also been witnessing strong order activity, which resulted in a backlog of $8 billion (as of July 4, 2026) for the Aviation segment.

GE's Price Performance, Valuation and EstimatesShares of GE Aerospace have gained 23.4% in the past three months compared with the industry’s growth of 8.6%.

Image Source: Zacks Investment Research

From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 44.20X, above the industry’s average of 34.03X. GE Aerospace carries a Value Score of D.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for GE’s 2026 earnings has gone up 5.1% over the past 60 days.

Image Source: Zacks Investment Research

The company currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Investors interested in Aerospace stocks should always be looking to find the best-performing companies in the group. Has GE Aerospace (GE - Free Report) been one of those stocks this year? A quick glance at the company's year-to-date performance in comparison to the rest of the Aerospace sector should help us answer this question.

GE Aerospace is a member of our Aerospace group, which includes 77 different companies and currently sits at #3 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.

The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. GE Aerospace is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for GE's full-year earnings has moved 5.9% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.

According to our latest data, GE has moved about 18% on a year-to-date basis. In comparison, Aerospace companies have returned an average of 5.6%. As we can see, GE Aerospace is performing better than its sector in the calendar year.

Another stock in the Aerospace sector, Heico Corporation (HEI - Free Report) , has outperformed the sector so far this year. The stock's year-to-date return is 12.3%.

Over the past three months, Heico Corporation's consensus EPS estimate for the current year has increased 7%. The stock currently has a Zacks Rank #1 (Strong Buy).

Looking more specifically, GE Aerospace belongs to the Aerospace - Defense industry, a group that includes 39 individual stocks and currently sits at #96 in the Zacks Industry Rank. On average, this group has gained an average of 4.5% so far this year, meaning that GE is performing better in terms of year-to-date returns.

In contrast, Heico Corporation falls under the Aerospace - Defense Equipment industry. Currently, this industry has 37 stocks and is ranked #70. Since the beginning of the year, the industry has moved +8.4%.

Investors interested in the Aerospace sector may want to keep a close eye on GE Aerospace and Heico Corporation as they attempt to continue their solid performance.

GE Aerospace's recurring revenue model supports long-term growth. Recent results show strong commercial engine services and supply chain improvements.

In this episode of Motley Fool Hidden Gems Investing, Motley Fool contributors Tyler Crowe, Matt Frankel, and Jon Quast discuss:

Uber’s acquisition of Delivery Hero.How “sticky” are ridesharing apps.GE Aerospace’s earnings.Can AI infrastructure cause supply chain headaches for others?Mailbag: How to view emerging industries & technologies.To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

This podcast was recorded on July 16, 2026.

Tyler Crowe: Who ordered the Uber acquisition today on Motley Fool Hidden Gems Investing? Welcome to Motley Fool Hidden Gems Investing. I'm your host for today, Tyler Crowe, and today I'm joined by longtime contributors Jon Quast and Matt Frankel. Earning season is starting to heat up. Not as many companies are rolling in. We're going to start to see that later in the month and early August, but we do have some early trickles in. Notably today, we had GE Aerospace. We'll also get to our mailbag, where we have some listener questions.

But we want to start today with the big announcement from Uber Technologies, who announced that they are going to acquire Germany delivery company, Delivery Hero in a $14.8 billion deal. Now, this has been telegraphed a little bit. Uber already had an outstanding stake in the company, and they agreed to acquire from, I believe it's, I hope I don't pronounce this wrong, but Prosus, they had a stake in the company, and they've agreed to sell it to Uber. Uber is going to have a 53% stake with this and then do a voluntary, “Hey, who wants to sell their shares to us, we'll buy them at a set price.” That's how the deal is structured. There's also a little bit of sell some of Deliver Hero’s assets in certain countries to avoid any jurisdiction, regulatory, anti trust issues. But I think the big thing to me, and, Matt, I want to really read in on this here. When I think of Uber, we always think of, like, hailing more specifically than delivery, and so this $14.8 billion deal seems to be like, Hey, we really want to be much more in delivery than we do just the ride share part.

Matt Frankel: Most investors don't realize it. But Uber's mobility, which is the name for the Rideshare business, and their delivery bookings are almost dead even, almost 50-51 in terms of booking volume. Now, the average person spends more on a delivery order than on a mobility order. You might get an Uber ride somewhere for $10, but the average meal you have delivered $50 or $60. Both grew about 25% year over year in the most recent quarter, but Rideshare is still Uber's biggest revenue source by a significant margin. They take roughly a 50% larger cut from bookings on ride-share versus delivery. This deal will make the delivery business significantly larger by bookings compared with Rideshare.

The bigger question here, as you mentioned, is why? Delivery Hero has an established presence in several markets already, so this allows Uber to expand its physical reach without building market by market, which is expensive and a risk. It roughly doubles the number of markets where Uber will offer both delivery and Rideshare in its app, which is a big competitive advantage. Speaking of competitive advantages, this is really a response to DoorDash, which has been aggressively expanding internationally and is really trying to outcompete Uber.

Tyler Crowe: Jon, not to like completely discount it, too, but in addition to rideshare delivery, which is creating this ecosystem, they do have a rather burgeoning advertisement business, as well, that, can layer onto this rather well, right?

Jon Quast: I think that there's absolutely an angle here that we need to consider with advertising, not to discount anything that Matt just said, I mean, there is a competitive angle here to this acquisition of delivery hero. Certainly DoorDash figures into the equation somewhere. But as you think about what Uber is, people don't realize how big and important the advertising business is. Really, it was the launch of advertising that propelled Uber to become a profitable business a few years ago and really just changed those economics considerably.

Now, if you think about what does it take to build a digital ad business, you really want platform adoption and interaction with that platform so that you can display the digital ad to the user, to the eyeballs, if you will. If it can get people adopting the platform more, the Uber platform, if it can get people interacting with the platform more, that's a greater chance for digital advertising. You want to grow both the mobility, the ride sharing, but also the delivery, the meal delivery because that's another, if you will, just another touch point with that end user. I think that as you're considering, hey, how do we build this food delivery or grocery delivery even more than what we have today? I think that there is an aspect that the management team is thinking, how do we get people interacting more with the platform because we want to show them an ad because that's really good for our business?

Tyler Crowe: It's funny, they say bad news comes in three, but I just want to say, news in general comes in three because, Matt, you, myself, and our Tuesday potting buddy, Lou Whiteman, we actually had a member live Q&A earlier this week, and Uber came up, specifically related to a lawsuit or a legal fight that they're picking with Alphabet's Waymo and it's related to autonomous taxis in Washington, D.C. area. We don't have to get into the details, but it's basically like Uber is saying, Hey, you need some humans every once in a while, and Waymo saying, No, you don't. But look, the broader point was, I think the legal fight exposed that, these ride-hailing or ride-sharing apps, whatever we want to call them, may not necessarily have that sticky network effect as much as people have initially believed. But does that same problem show itself in the food delivery segment, Ubers, delivery, DoorDash? Does that segment of the baby, is it as sensitive to this network, that, Well, I can pick whatever app I want, and it's not quite as sticky as, maybe food delivery is?

Matt Frankel: Well, it's not an easy answer. One conclusion that we drew in the discussion that you're talking about is that Waymo doesn't really need Uber's app to dominate a market. It certainly helps, especially at first, but it isn't totally necessary on a long-term basis. Riders are simply going to gravitate toward the largest and most liquid booking marketplace in their area. With delivery, there's even less stickiness in a lot of ways. Most people have two or three delivery apps on their phone. Many restaurants are on multiple platforms, so it's not exclusive. Usually, at least DoorDash and Uber Eats, and customers can price compare between the two apps. Some run fee specials on one app, but not the other. It's really not a sticky platform, but on the other hand, the Uber 1 membership platform that covers rides and delivery, that can be a competitive advantage when it comes to customer loyalty. DoorDash doesn't have the rideshare aspect of that. But the acquisition shows that scale and market density are really the true cues to winning in this business, not a sticky customer base.

Jon Quast: I just want to add on here a little bit. When we talk about network effects, I think that Uber does have a network effect, and it is a big deal. You think about what does it have? It has a two-sided marketplace. You have the consumer on one end, the person who needs a ride, but then you also have the driver on the other end. These are people voluntarily coming to the Uber platform saying, I'm going to offer my services here because there are potential customers on the other side of that marketplace and vice versa. That is really powerful, and I think that when you are a brand such as Uber, that is ubiquitous in many regards, that makes a big deal.

But what Waymo does is it's actually disrupting the game in an important way. It's not a two-sided marketplace. It's a one-sided marketplace. Can you gain that ubiquity with the one-sided business model cause you don't need the driver? That's my point. You're having the driverless cars. Really, it's just the proliferation of the vehicles themselves in those markets. It's disrupting the game, not that Uber doesn't have a powerful network effect. If we're playing the two-sided marketplace game, that's really important. But if autonomous vehicles are able to change the rules of the game by offering the one sided marketplace, I think that's where, this does get a little bit disruptive.

Tyler Crowe: All right, so we've got burgeoning advertising business that's layered on. It's creating profitability. It's growing market share and overall revenue and deliveries for all of it's part of the apps. But, we're talking about the risks here. I want to put you a little bit both on the spot with our last question here. Shares of Uber are more or less flat for a little over two years now, and I think they traded it I think when I checked this morning it's like 18 times earnings. Is this deal for Deliver Hero enough of a move-the-needle deal for this company? Or do you see this as like, it's just still treading water? I can't say I'm too interested in the stock right now.

Matt Frankel: For me, the answer is not really, and for two reasons. For one, this feels like more of a defensive move to me than an offensive growth strategy. No. 2, the multiple compression we've seen in Uber lately. You mentioned the stock's been flat for two years, even though the business has grown. It's primarily from worries about the ride-share side of the business, specifically Waymo, as a real threat to that part of the business. For those reasons, I don't think this is going to be a needle mover, but it's going to, be a preventative move.

Jon Quast: This is just a hot take for me, but I'm pretty lukewarm on this deal for Uber, mostly because it already has this really large international presence as a brand. I think it has incredible brand recognition globally. Then to acquire these assets from delivery hero and Uber CEO saying that he really appreciates some of these assets, I don't see that these assets are superior to its own. I think that Uber has superior assets. To spend this much money to acquire what I would consider inferior assets in international markets, that doesn't make a lot of sense to me, so I'm lukewarm on this deal right now, still processing it, but that's how I feel.

Tyler Crowe: All right, fair enough. Coming up after the break, we're going to talk about GEO spaces earnings.

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Tyler Crowe: Last week on the podcast, we talked about GE Vernova quite a bit, talking about the advantages, disadvantages, how it's been the strange darling of the GE breakup. It only seems fair that we discussed GE Aerospace because it did report earnings earlier today. The company's results beat expectations. Management raised guidance. But as we're taping this show right now, shares are down about 3.2%. Guys, can you help me connect the dots here. At least, as far as I saw, it seemed pretty good.

Matt Frankel: For one thing, and I know Jon has some thoughts about this, the market clearly had high expectations going into this. I was trading for about 50 times forward in earnings before this report. Even though management raised guidance, they still flagged a few things that represent uncertainty, like elevated jet fuel prices, the macro environment, things like that. Demand is clearly outpacing supply here, which is good for pricing power, at least in the short term, but it also means that GE can't fully capture its opportunity right now, and I think that's a little bit of what investors are reacting to, as well.

Jon Quast: I would definitely double down on the valuation component here. You think about stocks that outperform the market. Usually growth is a very big component of that outperformance, and you look at how big and mature GE Aerospace is at this stage of the game. It's hard for me to imagine it's sustaining above average growth over the long term from here, and to Matt's point, trading right now at I believe it's 43 times its earnings, that's quite elevated relative to the average valuation of the stock market right now. I think that even if the stock, I think there's a case where the stock could drop further to come down to a reasonable valuation, but even if it doesn't, I think that it's going to have to sustain some really powerful, impressive growth over the next several years just to justify where it's at right now. I think that even though it did deliver that double beat, I think that investors are saying, maybe this is a little bit too hot to handle right now, and we'll just trim our position.

Tyler Crowe: The thing that stood out to me, and this is taking it in a slightly different direction, thinking a little bit more of, like, supply chains and what's going on in the manufacturing world of America right now is that commentary from management about that availability of material for spare parts. It wasn't just like, we're running a little short on something. It was specifically like material because there happens to be another major turbine maker, GE Vernova, who also is building way more turbines than they can basically fulfill right now. They've got a five-year backlog on what they need to do. I don't want to sound like a broken record, I would call it, like, the super niche, only maybe five people might get this joke, but whenever I say AI infrastructure, I'm most be like, Pee-Wee Herman was like, Ah, you said the secret word because we seem to do it every single day now.

But, that AI infrastructure build-out and AI's, infrastructure's ability to hoover up every spare dollar of capital or spare part out there. The capital expenditures that are going into this are crowding out a lot of other spaces. As we think about GE Aerospace and supply chains and disruption and like AI being the whale of the manufacturing industry and gobbling up everything it can, is there a real risk for these non-AI companies like GE Aerospace, that could run into supply chain crunches and cost inflation from AI taking up all its spare capacity?

Jon Quast: I want to just try to illustrate a little bit the tension that you're bringing out here, Tyler, and this is a complicated supply chain story with GE Aerospace. If you recall coming out of the pandemic, the pandemic certainly disrupted supply chain immensely, and a huge part of this business is the spare parts business, the repair business, right, that maintenance revenue, and if you look at what it just did in the most recent quarter, GE Aerospace, record internal shop visits. It is fixing stuff at some record volume here and so that's a really big deal. It is coming out of those supply chain constraints from the pandemic, breaking records in some places. But then at the same time, it said that material availability restraints grew 20% from the previous quarter. On one hand, I would say that GE Aerospace is getting it done operationally. It is definitely doing a lot of work and fixing supply chains where it can, and at the same time, as you highlighted, the AI market is just sucking up all this demand out there from so many places. It is still struggling to keep up with supply chain needs, and so it's a complicated story.

Matt Frankel: Spare parts demand is exceeding available supply. They have a $210 billion backlog. They can't get materials fast enough. The parts that go into turbines and data centers aren't identical. But they do use the same universe of specialty metals manufacturers. It's totally possible we'll see costs and lead times here get worse before they get better.

Tyler Crowe: It'll be an interesting thing to see, again, because it is hard to underestimate that ability of AI infrastructure to just suck up all the available resources, considering, you can go like four or five levels down the supply chain right now, and they're like, we're strained, and our backlogs are growing like crazy. It'll be curious to see if anyone that's not AI-related can end up getting the parts they need because it could be a challenge down the road. Coming up after the break, we'll jump into the mailbag.

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Tyler Crowe: Hey, everyone, just a quick reminder. If you want to get a question into us, you can email us at podcast at fool.com. That's podcast with an s at fool.com. It's also in the show description. If you need a link. At three requests when you do it or number one, keep it Foolish. Two, keep it short enough, we can read on air and three, we can't give any personalized advice, so try to keep it as general as possible.

Today's question comes from Suleiman in Saudi Arabia. The question is, hello, fools. I found your podcast my first week of the job in 2024, and I haven't missed a single episode since. Hey, thanks for that Suleiman. That's awesome. I learned so much how to analyze companies and ask right questions. Question that he had was with many new emerging industries, there are some companies that are leading a small market with huge potential for expansion, and the one that he was specifically talking about here is Deep Sea mining. However, the industry is still facing legislative obstacles and operational uncertainties. Is this considered a foolish investment or an unnecessary risk? There's one company that he asked about specifically, and that's The Metals Company, which is Ticker TMC. Guys, I'm going to let you take a swing at it, and then I'll see if I can wrap it up at the end.

Jon Quast: This is a great question, and I think that emerging trends are pretty difficult when it comes to investing, and that is because they are so grounded in the future, none of us are very good at predicting the future with certainty. We all are limited in time and space. It's challenging. There are three questions that I would ask as I approach an emerging trend. Here's the first question. Will it emerge? Second, when will it emerge? Third, how will it emerge? Will it, when will it, and how will it? Those are really three important things to answer if you're going to start investing in a trend.

To the first one, will it emerge? I can rewind the clock to 3D printers when this was just coming out onto the market. I don't even remember how long ago anymore, but it was probably over 10 years ago. I really was a believer that these were going to be in every single home in the United States in the world. It was going to be completely like a TV in your home. You're going to have a 3D printer. Alas, it did not play out that way.

Three-D printing is bigger today than it was 10 years ago, but it didn't play out the way that a lot of us were thinking about at the time, or a lot of people were talking about. Did it emerge? Not really. Second, when will it emerge? Now, quantum computing is another example that we can use here. It's a huge in the public awareness right now, quantum computing is big because there's publicly traded companies and stocks are doing well. But those of us who have followed the quantum computing space much longer, I think, 20 years or so. This has taken a long time to play out. Directionally, I think it's still right, but the speed at which it is being adopted and coming to fruition is way behind what some people would have projected years ago, and maybe there's still a long time yet. When will it emerge? Hard to say. But finally, how will the trend play out?

Because you can theoretically be right about a trend, and you can be right about a timeline, but it might take a different route or go down some different train tracks than you anticipated, and therefore, the opportunity is in a place that you didn't really expect when you started investing. I would use e-commerce as an example here. Did e-commerce play out and very quickly? Yes, it did.

But think about how many of the physical retailers were able to lean into omnichannel. Now, e-commerce played out maybe differently than we thought, so maybe we thought that Walmart would be completely disrupted. But in reality, Walmart’s become one of the largest e-commerce players in the world because it leveraged its existing store base as a distribution center network through omnichannel. It played out quite differently, and I think that you would have invested a little bit differently depending on if you could foresee how it was playing out.

Matt Frankel: I want to expand on what Jon just said about how you can be directionally right about a trend, but the investment opportunities might be a different story. Think of the dot-com era, which is right around when I started investing. Being right about the trend and which companies will be the biggest winners from a trend are two completely different things. The Internet changed the world. No doubt. It's been the biggest technological change in our lifetimes. Period. Some of the highest flying stocks of the dot-com boom, pets.com is a good example. If you just said, who, that's my point. It went to zero, and investors lost a ton of money, but Amazon survived and thrived. It had a true cost advantage. It was building a scale advantage.

Business fundamentals that apply no matter what the trend is. I’m not well-versed in deep-sea mining, at least not enough to intelligently comment on the opportunities there. But quantum computing has a lot of parallels. Should you invest in the pure-play quantum stocks with impressive technologies or the established businesses with deep pockets and just happen to have quantum divisions like Cisco and IBM? The market misjudging timing and, market size with emerging industries is a common pattern. Jon mentioned 3D printing. That's exactly what happened there. Keep that in mind when it comes to position sizing and the real possibility that some of the most hype stocks in any trend could go to zero.

Jon Quast: With this question regarding Deep Sea mining in The Metals Company, let's say that you have satisfied yourself with the answers of will it, when will it, and how will it? The other thing to consider here is the economics. Assuming that Deep Sea mining plays out as a trend in the timeline that you think the metals company is a leader in the space, are the economics of that business at scale ones that are attractive for an investment? Because oftentimes, mining isn't a very compelling investment venture from an economic perspective. The economics are complicated and not always the most attractive. That would be the further question that I would ask once you've answered the other three.

Tyler Crowe: Jon stole my thunder a little bit here because I might be the only deranged person who follows materials in mining of the three of us a little bit. With a lot of these, like, speculative mining companies that are like, pre-revenue, and they put all these things like, Man, if we could mine all of this, it's trillions and trillions of dollars worth of revenue. No. 1, they always tend to over inflate how much is actually, like, available for them to recover. No. 2, they always underestimate the costs. They always tend to overestimate the profits with, the cost of metals at the time that they're acquiring it. On paper in the investor decks, it looks spectacular. But then when, the rubber hits the road and all the capital that means to go into these things, they tend to not turn out great.

Now, I'm not saying that The Metals Company is exactly going to go this way, but I feel like I've read 40 or 50 investor decks that looked a lot like this. One of the things I always say is there are multibillion-dollar mega mining giants out there, and they're not touching this. There's probably a reason. If they were to see some big mining backing from this, that could be the case. But otherwise, this is really, like, you might as well be buying Lottery tickets.

That's my thought on mining. You can tell I'm not exactly a huge fan of it, even though I have studied it in the past. Guys, that's all the time we have for today. Matt, Jon, I want to thank you for sharing your thoughts. I’m going to hit disclosure, and we'll get out of here.

Always, people on the program may have interest in the stocks to talk about, and The Motley Fool may have formal recommendations for or against. Don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. Advertisements or sponsored content provided for informational purposes only. See our full advertising is closer, please check out our showrooms. Thanks for producer Bart Shannon and the rest of The Motley Fool team for Jon, Matt, and myself. Thanks for listening, and we'll chat again soon.

Earnings are arguably the most important single number on a company's quarterly financial report. Wall Street clearly dives into all of the other metrics and management's input, but the EPS figure helps cut through all the noise.

We know earnings results are vital, but how a company performs compared to bottom line expectations can be even more important when it comes to stock prices, especially in the near-term. This means that investors might want to take advantage of these earnings surprises.

Hunting for 'earnings whispers' or companies poised to beat their quarterly earnings estimates is a somewhat common practice. But that doesn't make it easy. One way that has been proven to work is by using the Zacks Earnings ESP tool.

The Zacks Earnings ESP, ExplainedThe Zacks Expected Surprise Prediction, or ESP, works by locking in on the most up-to-date analyst earnings revisions because they can be more accurate than estimates from weeks or even months before the actual release date. The thinking is pretty straightforward: analysts who provide earnings estimates closer to the report are likely to have more information.

With this in mind, the Expected Surprise Prediction compares the Most Accurate Estimate (being the most recent) against the overall Zacks Consensus Estimate. The percentage difference provides the ESP figure. The system also utilizes our core Zacks Rank to provide a stronger system for identifying stocks that might beat their next quarterly earnings estimate and possibly see the stock price climb.

When we join a positive earnings ESP with a Zacks Rank #3 (Hold) or stronger, stocks posted a positive bottom-line surprise 70% of the time. Plus, this system saw investors produce roughly 28% annual returns on average, according to our 10 year backtest.

Stocks with a #3 (Hold) ranking, which is most stocks covered at 60%, are expected to perform in-line with the broader market. But stocks that fall into the #2 (Buy) and #1 (Strong Buy) ranking, or the top 15% and top 5% of stocks, respectively, should outperform the market. Strong Buy stocks should outperform more than any other rank.

Should You Consider TransDigm Group?Now that we understand what the ESP is and how beneficial it can be, let's dive into a stock that currently fits the bill. TransDigm Group (TDG - Free Report) earns a #3 (Hold) right now and its Most Accurate Estimate sits at $10.26 a share, just 11 days from its upcoming earnings release on August 4, 2026.

By taking the percentage difference between the $10.26 Most Accurate Estimate and the $10.21 Zacks Consensus Estimate, TransDigm Group has an Earnings ESP of +0.42%. Investors should also know that TDG is one of a large group of stocks with positive ESPs. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

TDG is part of a big group of Aerospace stocks that boast a positive ESP, and investors may want to take a look at GE Aerospace (GE - Free Report) as well.

GE Aerospace is a Zacks Rank #3 (Hold) stock, and is getting ready to report earnings on October 20, 2026. GE's Most Accurate Estimate sits at $2.01 a share 88 days from its next earnings release.

The Zacks Consensus Estimate for GE Aerospace is $1.99, and when you take the percentage difference between that number and its Most Accurate Estimate, you get the Earnings ESP figure of +0.78%.

Because both stocks hold a positive Earnings ESP, TDG and GE could potentially post earnings beats in their next reports.

Find Stocks to Buy or Sell Before They're ReportedUse the Zacks Earnings ESP Filter to turn up stocks with the highest probability of positively, or negatively, surprising to buy or sell before they're reported for profitable earnings season trading. Check it out here >>

GE Aerospace (GE - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.

Over the past month, shares of this industrial conglomerate have returned -6.8%, compared to the Zacks S&P 500 composite's +0.4% change. During this period, the Zacks Aerospace - Defense industry, which GE falls in, has lost 2.5%. The key question now is: What could be the stock's future direction?

Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.

Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

GE is expected to post earnings of $1.96 per share for the current quarter, representing a year-over-year change of +18.1%. Over the last 30 days, the Zacks Consensus Estimate has changed +4.9%.

The consensus earnings estimate of $7.82 for the current fiscal year indicates a year-over-year change of +22.8%. This estimate has changed +5.8% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $8.86 indicates a change of +13.3% from what GE is expected to report a year ago. Over the past month, the estimate has changed +2.3%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for GE.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.

For GE, the consensus sales estimate for the current quarter of $12.45 billion indicates a year-over-year change of +10.1%. For the current and next fiscal years, $50.81 billion and $55.1 billion estimates indicate +20.1% and +8.4% changes, respectively.

Last Reported Results and Surprise HistoryGE reported revenues of $12.63 billion in the last reported quarter, representing a year-over-year change of +24.5%. EPS of $2.02 for the same period compares with $1.66 a year ago.

Compared to the Zacks Consensus Estimate of $11.86 billion, the reported revenues represent a surprise of +6.52%. The EPS surprise was +8.6%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates each time over this period.

ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.

Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

GE is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about GE. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.

At the Farnborough International Airshow, a heavily modified Saab 340B turboprop quietly achieved a breakthrough that the commercial aviation sector has long viewed as a distant dream. Operating above 30,000 feet, a megawatt-class hybrid-electric propulsion system sustained flight for over two hours.

GE Aerospace Today

GE

GE Aerospace

$344.13 +3.43 (+1.01%)

As of 12:32 PM Eastern

This is a fair market value price provided by Massive. Learn more.

52-Week Range$259.95▼

$382.97Dividend Yield0.55%

P/E Ratio40.53

Price Target$380.89

For GE Aerospace NYSE: GE, this successful collaboration with NASA and Boeing NYSE: BA validates the engineering viability of high-voltage, high-altitude hybrid commercial flight.

The successful deployment of this technology at commercial cruise altitudes shatters the engineering ceiling that previously restricted electric aviation to low-altitude air taxis and short-hop experimental aircraft. GE Aerospace proved that hybrid-electric architecture can eventually scale to commercial jetliners.

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By combining traditional fuel consumption with high-capacity electric battery power, GE Aerospace is actively drafting the blueprint for next-generation propulsion.

Pulling the Sustainable Aviation Timeline ForwardStructural transitions in the physical economy do not happen overnight. The immediate takeaway is not that legacy jet engines will disappear tomorrow, but rather that GE Aerospace has established a strong research-and-development moat. This milestone pulls the timeline for sustainable aviation forward by a decade.

If airlines begin replacing their narrowbody fleets in the late 2030s to comply with tightening global regulatory mandates, this foundational technology positions GE Aerospace to dictate the terms of the market. Regulatory bodies have historically lagged behind localized commercial deployment, meaning governments will mandate sustainable flight only after a manufacturer proves it can be done safely and at scale. By clearing the 30,000-foot hurdle today, the engineering gap between GE Aerospace and its competitors is widening, establishing a clear pathway to long-term dominance in the aerospace sector.

$210 Billion Backlog: Fueling Margins on the GroundThe market does not award a trailing price-to-earnings ratio of 40 just for successful science projects. Investors pay for ruthless execution and highly visible cash flow. While the hybrid-electric milestone captures headlines, the underlying fundamentals of GE Aerospace justify its $354 billion market capitalization.

Second-quarter 2026 earnings delivered a resounding beat, with GE Aerospace posting $2.02 in earnings per share against a $1.86 consensus estimate. This profitability was driven by a 21.1% year-over-year revenue expansion.

More importantly, GE Aerospace is operating with extreme efficiency. Net margins stand at a robust 17.72%, while return on equity has reached an exceptional 40.56%. In a highly capital-intensive industry, generating a 40% return on shareholder equity indicates that executives are highly effective at allocating capital to profitable projects rather than burning cash on low-yield ventures.

The ultimate driver of this financial performance is unyielding commercial demand, crystallized in a staggering $210 billion backlog. During the Farnborough event, traditional propulsion systems demonstrated their immediate scale. CFM International, the highly successful joint venture between GE Aerospace and Safran OTCMKTS: SAFRF, finalized a memorandum of understanding with IndiGo for more than 1,000 LEAP-1A engines. Additional agreements secured hundreds of engine packages for leasing giants like BOC Aviation and SMBC Aviation Capital.

To protect profitability amid inflationary pressures on raw materials and engine durability kits, GE Aerospace leaned heavily on its proprietary FLIGHT DECK operational system. This internal initiative successfully increased shop visit output and streamlined maintenance operations, effectively shielding a 21.7% operating profit margin.

Turbulence Ahead: The Supply Chain Reality CheckDespite the exceptional demand profile, the aerospace sector is currently wrestling with severe macro headwinds, primarily taking the form of raw material bottlenecks and supply chain constraints.

During the latest earnings call, CEO Larry Culp explicitly stated that the operational hurdle is a supply-side challenge. There are no victory laps being taken in the executive suite. While order growth surged 17%, spare parts delinquency increased 20% sequentially. Airlines are desperate for engines and replacement parts, but manufacturers are struggling to forge and assemble components fast enough to meet that demand.

This logistical bottleneck highlights why the hybrid-electric propulsion breakthrough poses no immediate existential threat to legacy airline models. The multi-decade lifecycle of existing commercial airframes means the transition will be gradual. A systemic overhaul of global aviation infrastructure would take time, and the immediate displacement of fossil-fuel engines is logistically impossible.

Beyond commercial aviation, GE Aerospace continues to bolster its defense portfolio. A recent partnership with Shield AI successfully integrated the X-Bat engine, enabling thrust vectoring and vertical flight capabilities. This dual-use capability across both the commercial and defense sectors provides a stabilizing revenue stream against potential disruptions to the commercial supply chain.

Capital Allocation: The Silent Earnings EngineThe most compelling near-term catalyst for GE Aerospace is not found in the clouds, but on the balance sheet. High-level research and development expenditures require strong free cash flow, and GE Aerospace is deploying that cash to drive aggressive shareholder yield.

During the second quarter, GE Aerospace repurchased 14.1 million shares for $4.22 billion. GE Aerospace still has $17.99 billion remaining under its active $20 billion buyback authorization. For investors, this aggressive capital-return program serves as a structural floor for valuation.

When GE Aerospace retires a significant portion of its outstanding shares, it artificially compresses forward valuation multiples by reducing the denominator in the earnings-per-share calculation. Currently trading at a forward price-to-earnings ratio of 43 and a price-to-sales multiple of 7.7, the stock appears richly valued at first glance. The relentless execution of this $20 billion buyback authorization will systematically increase the ownership stake of remaining shareholders while driving earnings growth, even if top-line revenue temporarily slows due to supply constraints.

Boarding Pass: Strategizing the Aerospace TransitionThe financial mechanics of the pure-play aerospace transition have attracted heavy institutional conviction, with ownership currently sitting at a dominant 75%. Prominent capital inflows from entities such as the Bessemer Group validate Wall Street's confidence in GE Aerospace's long-term trajectory.

GE Aerospace offers a unique combination of immediate, high-visibility cash flow and long-term technological dominance. The legacy $210 billion backlog funds the research required to lead the next generation of hybrid-electric flight, effectively creating a self-sustaining cycle of innovation and profitability.

While technological breakthroughs push sustainable aviation timelines forward, the true underlying value for current investors lies in the immediate execution of share repurchases and margin protection. Investors with a long-term horizon might consider buying shares during periods of broader market volatility, recognizing that GE Aerospace is effectively paying them to wait through an extensive buyback program while it engineers the future of commercial flight.

Should You Invest $1,000 in GE Aerospace Right Now?Before you consider GE Aerospace, you'll want to hear this.

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GE Aerospace Chairman and CEO Larry Culp discusses the company's order backlog, supply chain investments, and how improved deliveries from key suppliers is helping to boost output. He speaks with Guy Johnson on the sidelines of the Farnborough International Air Show 2026.

© Lukas Wunderlich / iStock Editorial via Getty Images

GE Aerospace CEO Larry Culp used a Farnborough Air Show appearance on CNBC this morning to spotlight its advanced technology and strong second-quarter results. GE Aerospace (NYSE:GE | GE Price Prediction) said its testbed aircraft flew across the Atlantic under partial hybrid electric power to reach the show, then delivered a Q2 report that put commercial services growth, engine deliveries, and aftermarket spare parts all on the same steep trajectory.

Culp framed the flight as a technology proof point. “We had the first ever high altitude hybrid electric flight crossing the Atlantic to bring that plane here. This is a first of its kind. And as you might imagine, we’re terribly excited,” he said, describing the SAAB A340 testbed program run in collaboration with Boeing (NYSE:BA), Beta Technologies, and NASA. He was careful to set realistic expectations: “Hybrid electric is a key part of that. So nothing imminent in terms of a product launch. But this is a strong proof point that hybrid electric will be part of that next generation commercial offering.“

The Numbers Behind the Headline GE Aerospace saw revenues increase 21% in the quarter, and earnings per share were up 22% year over year. Total engine deliveries were up 31% in the first half of the year, and aftermarket spare parts revenues were up over 30% in the same window. Commercial Engines & Services were up 27% to $9.73 billion, and Defense & Propulsion Technologies were up 16% to $3.44 billion. Free cash flow reached $3.03 billion.

Management lifted full-year 2026 guidance to adjusted EPS of $7.65 to $7.85, operating profit of $10.55 to $10.75 billion, and free cash flow of $8.90 to $9.20 billion.

A $210 Billion Order Book The demand signal driving those numbers is a backlog Culp put at $210 billion between new engines and aftermarket services. “Customers that we talk to are very keen to see us continue to ramp in partnership with our airframe partners,” he said. That ramp is tied directly to Boeing, whose 737 program is running at 42 per month and 787 program at 8 per month, with a Boeing commercial backlog of $695 billion. LEAP engines power the 737 MAX, and GEnx powers the 787.

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Q2 also brought LEAP engine deliveries up 24%, with recent commercial wins including a Copa Airlines agreement for up to 120 LEAP-1B engines and a Turkish Aerospace agreement for F404 engines on the HÜRJET trainer.

Durability Kits and Time on Wing Culp also updated investors on the LEAP durability kit rollout, a fix aimed at improving time on wing in hot and harsh operating environments. “Our narrowbody engine, our LEAP engine, saw a durability kit introduced last year on the Airbus version of that engine. We’ve got 40% of the fleet retrofitted already performing very well,” he said. GE has previously said the LEAP-1B durability kit is now certified, targeting roughly a 2x improvement in time on wing, with full cutover expected at the beginning of 2027.

What to Watch GE shares opened at $348.83 on Monday, July 20, up 13.55% year to date and up 34.7% over one year, against a Wall Street analyst target price of $397.86. Boeing sits at $214.03, down 1.42% year to date, a divergence that captures which side of the airframe-engine partnership has been executing at scale.

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Contact [email protected] for any questions or corrections.

FARNBOROUGH, England, July 20, 2026 (GLOBE NEWSWIRE) -- IndiGo, India’s largest airline and one of the world’s fastest-growing carriers, today announced it has signed an MoU (Memorandum of Understanding) with CFM International for an order of 1,000+ LEAP-1A engines to power 510 Airbus A320neo Family aircraft. This will be the largest single order ever placed for LEAP engines and a record for CFM International.

The MoU also includes CFM’s extensive support in establishing IndiGo’s upcoming engine MRO facility (maintenance, repair and overhaul) and support IndiGo’s rapidly growing fleet through long term material services agreement, including supply of spare parts, ensuring high dispatch reliability, predictable costs, and world-class support as the airline further scales its operations.

On this occasion, Willie Walsh, Chief Executive Officer Designate, IndiGo said, “As IndiGo embarks on its next phase of growth towards becoming a truly global airline, we are delighted to extend our long-standing partnership with CFM International for the engines powering future deliveries of our Airbus A320/321neo Family aircraft fleet. CFM has been a trusted partner in our growth journey since 2016, supporting a fleet that now exceeds 375 A320/321 Family aircraft. The LEAP engine's industry-leading proven reliability makes it the ideal choice to support our scale, operational resilience and sustainability ambitions. This partnership reinforces our commitment to providing safe, reliable and efficient travel across an ever-expanding network in India and around the world.”

IndiGo has been a valued CFM customer for 10 years. In 2016, the airline operated a sub-fleet of Airbus A320ceo Family aircraft powered by CFM56-5B engines. In 2019, IndiGo deepened its relationship with CFM, ordering LEAP-1A engines for their newest fleet of Airbus A320/321neo Family aircraft.

“IndiGo has trusted CFM to support its performance for a decade now, and we're honored to renew that trust with today's agreement. LEAP engines are delivering up to twice the time on wing in hot and harsh operating environments than when they entered service, while continuing to provide fuel efficiency and reliability,” said H. Lawrence Culp, Jr., Chairman and Chief Executive Officer at GE Aerospace. “As we continue to strengthen the program to best serve our customers, GE Aerospace is also proud to build on more than 40 years of support for India’s aviation sector. With a strong installed base, manufacturing in Pune, a broad local supplier network, and advanced engineering in Bengaluru, we remain committed to supporting IndiGo’s growth and expanding our presence in India.”

CFM has a long-standing footprint on the Indian subcontinent, as India is CFM’s third-largest market, with five Indian carriers operating more than 400 LEAP-powered aircraft and 2,000 engines on order.

"This historic milestone reflects the long-standing partnership between IndiGo and CFM. It underscores the trust that airlines place in the performance and value delivered by the LEAP engine”, said Olivier Andriès, Chief Executive Officer of Safran. “As one of the world’s fastest-growing aviation markets, India is of strategic importance to Safran. Through our continued investments in the country, particularly in LEAP engine production and MRO capabilities, we are strengthening our long-term commitment to supporting IndiGo’s remarkable growth and to contributing to the development of Indian aerospace industry."

Last year, Safran inaugurated its largest MRO (maintenance, repair, overhaul) center for the LEAP engine. The 45,000-square-meter facility will ramp up to a capacity of 300 LEAP shop visits a year and boast a next-generation test bench.

With more than 10,000 engines delivered to date, CFM LEAP engines have experienced the fastest ramp in commercial aviation history. CFM continues to upgrade the LEAP fleet with a high-pressure turbine (HPT) durability kit to extend time on wing and a reverse bleed system (RBS) to lower airline maintenance burden. The company is focused on delivering high engine availability through exceptional MRO performance and competitive cost of ownership, with the benefits of aftermarket competition through its open MRO ecosystem.

About IndiGo
IndiGo is India’s preferred and amongst the fastest growing carriers in the world. IndiGo has a simple philosophy: offer fares that are affordable, flights that are on time, and provide a courteous and hassle-free travel experience across its unparalleled network. With its fleet of 430+ aircraft, the airline operates approximately 2200 daily flights, connecting 95+ domestic and 45+ international destinations, and welcomed more than 123 million customers in FY26. IndiGo was named the ‘Best Airline in India and South Asia’ by Skytrax at the World Airline Awards 2025 and the sixth Most Punctual Airline in Asia-Pacific in 2025 by the global aviation analytics firm, Cirium. For more information, please visit http://www.goindigo.in/ or download our mobile app.

About CFM International
A 50/50 joint venture between GE Aerospace and Safran Aircraft Engines, CFM International has redefined international cooperation and helped change the course of commercial aviation since its founding in 1974. Today, CFM is the world’s leading supplier of commercial aircraft engines with a product line that sets the industry standard for efficiency, reliability, durability, and optimized cost of ownership. CFM International produces the LEAP family of engines and supports LEAP and CFM56 fleets for operators worldwide. For the future of air transport, CFM’s RISE program is accelerating development of new propulsion technologies that will pave the way for the next generation of aircraft. Discover more at www.cfmaeroengines.com  

Signing Ceremony between IndiGo and CFM

Signing Ceremony between IndiGo and CFM IndiGo, India’s largest airline and one of the world’s fastest-growing carriers, today announced it ...

FARNBOROUGH, England, July 19, 2026 (GLOBE NEWSWIRE) -- The GE Aerospace (NYSE: GE) GEnx-1B engine has surpassed the 50 million flight hour mark in just over 14 years, the fastest rate ever for GE Aerospace commercial widebody engine model.

The GEnx-1B, which powers the Boeing 787 Dreamliner family, is currently in service with more than 50 operators around the world and is averaging a total of over 600,000 flight hours monthly. The engine boasts a 99.98% dispatch reliability rate and stays on-wing at a rate three times higher than competing engines.

Mohamed Ali, President & CEO, GE Aerospace Commercial Engines & Services, said: “Airlines need engines that deliver reliability, durability, predictability, and efficiency across some of the world’s most demanding routes, and the GEnx-1B continues to do exactly that. Reaching 50 million flight hours for the GEnx-1B in less than 15 years is a remarkable milestone, and it reflects the trust our customers place in GE Aerospace every day.”

The GEnx engine family has more than 2,700 engines in service, including spares. The GEnx-2B has accumulated 24 million hours since entering service in 2011 on the Boeing 747-8. In total, the GEnx engine family has nearly 75 million flight hours and nearly 12 million cycles.

The long-haul flights the GEnx engine powers traverse some of Earth’s harshest environments. Over the last decade, GE Aerospace has upgraded the GEnx engine’s high-pressure turbine blades and combustor coating technology, more than doubling time on wing in harsh environments.

GE Aerospace is also investing $1 billion this year across our U.S. manufacturing sites and supply chain, with over $100 million dedicated to enhancing supplier capabilities for programs like the GEnx engine. These investments focus on increasing engine production capacity, modernizing facilities, and strengthening the supply chain to meet high demand.

Continued support through service innovation
GE Aerospace has implemented a number of on-wing technologies available for the GEnx, including:

360 Foam Wash: designed to break down and remove dust and dirt particles. GE Aerospace’s 360 Foam Wash can help improve engine compressor efficiency, reduce fuel consumption, lower CO2 emissions, and extend time between shop visits.

Blade Inspection Tool (BIT): This technology gives GEnx-1B and -2B customers clear and consistent insight during HPT Stage 1 & Stage 2 blade inspections. Blade inspectors with integral cameras capture images with cutting edge AI technology, extracting and presenting them for review. BIT enables the user to measure both lines and areas on blade surfaces, to make an accurate assessment of the condition of hardware.

FlightPulse: A GE Aerospace application developed for pilots to measure their fuel use and other statistics against those of their peers or against their own previous flights so they can self-discover areas to optimize operations and efficiency.

GEnx’s revenue-sharing participants are IHI Corporation of Japan, GKN Aerospace Engine Systems of the UK, MTU of Germany, TechSpace Aero (Safran) of Belgium, Safran Aircraft Engines of France and Samsung Techwin of Korea.

About GE Aerospace
GE Aerospace is a global aerospace propulsion, services, and systems leader with an installed base of approximately 50,000 commercial and 30,000 military aircraft engines. With a global team of approximately 57,000 employees building on more than a century of innovation and learning, GE Aerospace is committed to inventing the future of flight, lifting people up, and bringing them home safely. Learn more about how GE Aerospace and its partners are defining flight for today, tomorrow, and the future at www.geaerospace.com.

GE Aerospace NYSE: GE is telling investors a familiar story after its Q2 2026 earnings report on July 16. The stock dropped about 5% in early trading the day after the release, despite strong top and bottom-line beats. The company also raised its full-year guidance.

GE Aerospace Today

GE

GE Aerospace

$353.95 +8.22 (+2.38%)

As of 12:24 PM Eastern

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52-Week Range$254.66▼

$382.97Dividend Yield0.53%

P/E Ratio43.75

Price Target$370.33

That pattern of a strong earnings report followed by a stock price decline has been the case for the last two earnings reports.

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The reason is a familiar one—valuation. GE trades at around 46x forward earnings, which is a premium to the S&P 500.

It’s also expensive compared to its historical average. But that needs some context, because GE Aerospace has only existed since 2024, when General Electric spun off its energy and healthcare businesses into GE Vernova NYSE: GEV and GE Healthcare Technologies NASDAQ: GEHC, respectively.

That means the “what have you done for me lately?” sentiment impatiently expressed by many investors may actually be an apt way of analyzing GE.

Aging Fleets Are Driving GrowthThe headline earnings numbers were impressive. Revenue of $12.63 billion beat estimates for $11.87 billion and was over 21% higher year over year (YOY). Earnings per share (EPS) of $2.02 beat the forecasted $1.86 and was also 21% higher YOY. Orders were up 17%, and free cash flow (FCF) was up a whopping 43%.

Those numbers looked even stronger over the first half of 2026. Orders grew 49% YOY to $39.5 billion. Adjusted revenue for the half rose 27%, and FCF climbed 31% to $4.7 billion.

As impressive as the headline numbers were, there’s a reason that GE Aerospace was willing to raise its full-year revenue and earnings outlook. The company is getting high demand from its airline customers who need to maintain aging fleets.

Management’s commentary provided more specifics. Commercial services revenue grew 32% in the first half, and total engine deliveries rose 31%. GE credited its internal "FLIGHT DECK" lean operating program for cutting shop turnaround times by roughly a week since the end of 2025. That helped drive record internal shop visit output during the quarter.

Defense demand added a second growth engine. GE's Defense & Propulsion Technologies segment posted a 1.55x book-to-bill ratio for the first half, meaning new orders outpaced revenue by 55%. Revenue in that segment grew 17% for the half, with strong contributions from Avio Aero.

Backlog Still the Real StoryMaking the results even stronger is the company’s reported backlog of over $210 billion. That backlog gives GE unusual visibility into future revenue, since engine orders typically convert into decades of service revenue once delivered. New wins in the quarter included Copa Airlines selecting up to 120 LEAP-1B engines and a U.S. Air Force contract for an autonomous collaborative platform design review.

The Guidance Raise Was SweepingThe expectation of continued strong demand was a catalyst for GE to raise its full-year 2026 guidance for revenue, earnings, operating profit, and FCF.

GE didn't just nudge its 2026 outlook higher. It raised guidance across every major line item. Adjusted EPS guidance moved to $7.65–$7.85, up from a prior $7.10–$7.40 range. At the low end, that's a 20% increase from the company's full-year adjusted EPS in 2025.

Operating profit guidance climbed to $10.55–$10.75 billion, versus a prior $9.85–$10.25 billion. Free cash flow guidance rose to $8.9–$9.2 billion, and revenue growth guidance moved from "low double digits" to "high-teens." Management credited robust services demand and equipment deliveries for the upgrade.

Is GE Overvalued?At around 46x forward earnings, GE is trading at a premium to the S&P 500 and its own historical average. However, the company’s free cash flow (FCF) grew by more than 40% year over year in the quarter.

That cash generation is showing up in shareholder returns, too. GE repurchased $2 billion of stock in the second quarter alone, and diluted share count fell by 24 million shares year over year. The company also ended the quarter with $9.3 billion in cash, or $10.3 billion including short-term investments.

Skeptics will note that kind of FCF growth may not be sustainable, but it’s important to remember that the current iteration of the company has only been in existence since 2024. That means the five-year valuation models, whether FCF or EPS, are factoring in business units that no longer exist for GE Aerospace.

It’s possible that GE falls back a little more, but there’s likely to be a floor above a rising 50-day simple moving average. That means any dip may be short-lived, which is supported by analyst sentiment. The consensus price target for GE is $365.61, and since July, several analysts have raised their targets, with Jefferies offering the highest at $455.

Free cash flow also indicates that the dividend is safe and will likely grow again. Right now, that dividend is more of an afterthought, but it’s not an insignificant reason to make the stock a core holding.

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