GE Aerospace Stock Is Ever-So-Close to a New Record. How It Can Get There.

GE Aerospace is working to improve operations amid strong demand. (Qilai Shen/Bloomberg)

Key Points

About This Summary

• GE Aerospace stock is nearing its all-time high, boosted by strong commercial aerospace outlook.
• Analysts predict further gains, with an average price target of $303, citing improved operations.
• CEO Larry Culp’s leadership is credited for the turnaround, with 79% of analysts rating the stock a Buy.

GE Aerospace stock is oh-so-close to an all-time high, reflecting the company’s incredible turnaround.

The shares’ rise says a lot about management and the outlook for the commercial aerospace industry.

GE Aerospace hit a new intraday 52-week high of $286.91 on Thursday, before finishing the day down 0.7% at $281.56. In comparison, the S&P 500 and Dow Jones Industrial Average rose 0.8% and 1.3%, respectively.

The stock’s recent highs put a longstanding record in sight. GE, which is now GE Aerospace, hit an all-time closing high of $287.15 on Aug. 28, 2000, according to Dow Jones Market Data. The record intraday high is $289.54, also hit that day.

GE stock is roughly $6 from the record close and $3 from the intraday record—in other words less than 2% away for both measures.

Wall Street sees a new high any day now. The average analyst price target is $303 a share, according to FactSet. Target prices can generally be understood as where analysts expect the stock to be over the next 12 months. Target prices change, though. The average target price started the year at about $211 a share.

Things have been getting better in commercial aerospace. Boeing’s unfilled orders total about 6,000 jets, while the equivalent number for Airbus is about 8,700. The estimated 2025 jet deliveries for the pair are roughly 1,400, according to FactSet. Order backlogs for commercial airplanes stretch out for more than 10 years at the current pace of production. That’s good news for GE Aerospace, which produces engines for both companies.

While demand is strong, GE Aerospace is working to improve operations.

“There’s a lot of [margin] opportunity there,” says Joseph Shaposhnik, portfolio manager of the Rainwater Equity ETF. While the stock trades at 40 times estimated 2026 earnings, shares won’t look expensive in two years after earnings growth and margin improvement, he adds.

GE Aerospace’s operating profit margins rose to about 21% from 16% between 2022 and 2024. Wall Street sees margins hitting 22% by 2026.

“Larry [Culp is] the greatest industrial CEO of our time, running one of the better industrial businesses that we have in the U.S.,” adds Shaposhnik. GE was “totally undermanaged before he got there.”

Wall Street appears to agree with that sentiment. Overall, 79% of analysts covering the stock rate shares Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 55%.

It’s been an astounding comeback for the company. Shares traded below an adjusted $35 a share in December 2018, just after CEO Larry Culp arrived to help turn around the iconic American manufacturer, beset by bad acquisitions and debt.

Adjustments are required because the old GE is now three companies using the script monogram logo: GE Aerospace, GE HealthCare Technologies, and power technology provider GE Vernova.

An all-time high would value GE Aerospace at roughly $320 billion. In 2020, GE’s market value was closer to $600 billion. The three GE’s are now worth a combined $510 billion. There is another $90 billion or so for the total GE to eclipse its old record.

Write to Al Root at allen.root@dowjones.com