Could GE Aerospace's Strong Q2 Help It Soar Higher? Analyst Weighs In

Goldman Sachs analyst Noah Poponak reiterated a Buy rating on GE Aerospace GE and raised the 12-month price target to $271 from $257 following the company’s strong second-quarter performance and upward revisions to both near- and long-term guidance.

GE Aerospace posted adjusted revenue of $10.2 billion for the quarter, up 23% year over year, while earnings per share rose 38% to $1.66, topping Wall Street estimates. Growth was driven by strong demand in Commercial Engines and Services, which jumped 30%, and Defense and Propulsion Technologies, which rose 7%.

The company nearly doubled free cash flow to $2.1 billion, secured record engine deals, and reported operational gains through its Flight Deck system.

Building on this momentum, GE Aerospace raised its full-year outlook. It now expects 2025 adjusted EPS of $5.60 to $5.80, compared with a prior range of $5.10 to $5.45, and operating profit as high as $8.5 billion. Its long-term guidance for 2028 includes about $11.5 billion in operating profit and roughly $8.40 in EPS, supported by a $175 billion backlog and a plan to return at least 70% of free cash flow to shareholders.

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Poponak cited the company’s across-the-board beat on revenue, margins, and cash flow, attributing it to pricing power, higher volume, and operational efficiency. He noted that both commercial and defense segments benefited from increased spare parts sales and shop visits.

Despite the improved outlook, Poponak called GE’s targets conservative, pointing to its leadership in the aircraft engine market and the stability of long-term service contracts.

Following its recent investor day, GE outlined a growth plan that tripled the LEAP engine installed base and doubled GEnx volume by 2028.

Long term, Poponak views GE Aerospace’s dominant market position as a key advantage, enabling durable growth supported by pricing strength and margin expansion. In the near term, tight market conditions and pent-up demand are contributing to strong financial performance.

The revised $271 price target reflects a 2026E EV/EBITDA multiple of 24.5x, raised from 23.5x to account for stronger earnings visibility and favorable peer comps. Risks to the outlook include ongoing supply chain challenges, a potential air travel slowdown, and shifts in defense budget priorities.

GE Price Action: At the last check on Friday, GE Aerospace shares were trading higher by 2.61% at $267.38.

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