GE Aerospace reports its first quarterly results as a pure-play aerospace company early Tuesday following the April 2 split of General Electric’s power and renewables businesses. GE stock spiked nearly 40% leading up to the spinout and has continued to trend higher.

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FactSet analysts expect GE Aerospace (GE) to report adjusted earnings of 65 cents per share on $15.25 billion in revenue.

Prior to the split, GE last year reported Q1 adjusted earnings of 22 cents per share on $13.69 billion in sales.

TD Cowen on April 9 upgraded GE stock to buy from hold. Cowen noted it’s bullish on GE Aerospace’s commercial aftermarket prospects in light of Boeing (BA) production issues. Over 50% of GE Aerospace sales and 75% of its profits come from the commercial aerospace aftermarket following the spinoff, TD Cowen says. The report added that it should see a near-term boost from the Boeing 737 Max production challenges. The firm raised its price target on GE shares to $180 from $175.

Outlook

In early March, GE Aerospace guided 2024 revenue growth in the low double digits and targeted an operating profit of up to $6.25 billion with more than $5 billion of free cash flow.

GE Aerospace pared its 2025 revenue outlook to low double-digit growth, which is the lower end of its prior range of up to double-digit sales growth in the high teens. The company forecasts an operating profit of about $7.3 billion as the midpoint for the year.

GE Aerospace aims to reach an operating profit of $10 billion in 2028.

In terms of capital allocation, the company plans to deliver roughly 70%-75% of cash to shareholders through dividends and share buybacks. That includes an initial dividend payout at 30% of net income, subject to board approval, and $15 billion in share buybacks.

Elsewhere, GE Vernova (GEV) announces Q1 results early Thursday, the energy firm’s first report as an independent firm. GE HealthCare (GEHC), spun off in late 2022, reports on April 30.

GE Stock

Shares rose 0.8% early Monday, bouncing off its 21-day exponential moving average.

GE stock jumped 37% in 2024 leading up to the April 2 spinout.

GE Aerospace stock rallied more than 47% so far this year and is trading at its highest level since January 2017.

You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison

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