GE Aerospace (GE) is set to announce its first-quarter earnings for 2025 today, April 22, and expectations are high among investors and analysts alike. Following a solid performance in the previous year, the company is anticipated to report impressive figures, with analysts predicting earnings per share (EPS) of $1.27, marking a substantial 55% increase year-over-year, alongside a revenue rise of approximately 12% to $9.05 billion.
Wall Street analysts have expressed bullish sentiments regarding GE stock, citing the company's robust financial health and its ability to navigate challenges in the current macroeconomic environment. Notably, GE Aerospace's aftermarket business is expected to remain stable, a crucial factor as the company prepares to release its earnings report.
However, the ongoing U.S.-China trade tensions loom large, as reports indicate that China has urged airlines to delay deliveries from Boeing (BA), which could indirectly impact GE since it manufactures engines for Boeing aircraft. The interplay of these geopolitical factors adds a layer of complexity to GE's performance outlook.
In anticipation of the earnings announcement, Wells Fargo analyst Matthew Akers has reiterated a Buy rating on GE Aerospace stock, increasing the price target from $203 to $212. Akers believes that companies with strong aftermarket exposure, such as GE and TransDigm Group (TDG), represent safer investment options amid broader economic uncertainties. He noted, "Demand in the aerospace aftermarket remains resilient, with airlines operating older fleets more intensively and Maintenance, Repair, and Overhaul (MRO) shops fully booked through most of 2025." This sentiment reflects a confidence that GE's aftermarket business will provide a buffer against potential economic downturns.
On the other hand, Citi analyst Jason Gursky has lowered his price target for GE Aerospace from $235 to $227 but maintains a Buy rating. Gursky highlights that defense companies, including GE, have limited exposure to tariffs, which positions them favorably as global defense spending continues to rise. However, he cautioned that suppliers might experience some margin pressure, particularly those reliant on imports from Canada and Mexico, which could affect business jet manufacturers.
As the market awaits GE's earnings report, options traders are bracing for significant movement in the stock price. Analysis from TipRanks indicates that traders expect a potential 6.4% shift in either direction following the earnings announcement, underscoring the heightened anticipation surrounding the results.
In a premarket trading update, GE Aerospace's stock rose by 2.3% after preliminary reports indicated a double-digit revenue gain for the first quarter of 2025. This uptick came as the company reaffirmed its full-year guidance, demonstrating resilience in a challenging economic landscape.
In a notable achievement, GE Aerospace topped earnings estimates, delivering its first Q1 report since becoming a stand-alone entity in April 2024. The company reported an adjusted EPS of $1.49, a striking 60% increase that exceeded the expected $1.27 per share. This impressive performance reflects GE's strategic efforts to mitigate the impacts of tariffs, allowing it to maintain a positive outlook for the year.
Looking ahead, GE Aerospace has set its adjusted EPS range for 2025 between $5.10 and $5.45, slightly below the FactSet estimate of $5.42. This guidance indicates cautious optimism as the company navigates ongoing market challenges.
Overall, GE Aerospace's stock has shown strong performance, rising about 9% so far this year. With a consensus rating of Strong Buy based on 16 unanimous Buys, the average price target for GE stock stands at $230.67, suggesting approximately 27% upside potential from current levels.
As GE Aerospace prepares to unveil its Q1 results, investors and analysts alike are keenly watching how the company will address the challenges posed by the U.S.-China trade relations and its strategy for sustaining growth in the aerospace sector. The upcoming earnings report will not only shed light on GE's financial health but also provide insights into its future direction amid a rapidly evolving industry landscape.
