CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Our 12-month target price of $174, up $34, reflects a 29x multiple applied to our 2025 EPS estimate, in line with GE’s aerospace peers. We lift our 2024 EPS estimate by $0.09 to $4.58 and 2025’s by $0.17 to $5.99. The spinoff of GE’s renewables and power unit, GE Vernova, has now been officially slated for April 2, 2024, and GE will be a pure-play aerospace firm thereafter. We like GE’s prospects as a key supplier to a commercial aerospace industry that has considerable pent-up demand for new planes. However, we do see some risk for GE, notably its reliance on major original equipment manufacturer The Boeing Company (BA 200 **). In our view, BA is facing a bit of a high wire act, trying to iron out its various quality control issues on the narrow-body 737 MAX family, while also moving forward on the new widebody 777X plane, which GE will supply with engines. Near term, we think margin expansion may not be quite as strong as consensus is currently implying.