Since the completion of its historical transformation into a space leader concentrated in April 2024, GE Aerospace NYSE: Ge The performance of the prominent market was. Investors praised the climbing price at GE Aerospace and a continuous flow of the main engine orders.
GE Aerospace today
GE aerospace
- 52 weeks
- $ 150.20
▼
$ 257.47
- Profit
- 0.60 %
- P/E ratio.
- 37.16
- The target price
- 221.15 dollars
The main headlines often focus on impressive technology for their jet engines, as strong devices are installed on the wings of the latest Boeing and Airbus aircraft.
But this image offers a puzzle for investors trying to understand the real value of the company. The initial sale, which extends millions of dollars for the new Jet engine is not the main source of GE’s long -term profit.
This reality raises an important question: Where does the true financial strength of Gee come from if the value is not the value of building new engines and simply selling it?
The answer lies in a carefully made business model It gives priority to the long game for the initial sale.
“Gallery”: presented in the door
The first step in the GE strategy is to get its engines on the aircraft wing. This is “razor and blades”. when GE sells a jump engine For Boeing 737 Max or Airbus A320neo, its main goal is not an immediate profit. It is to win a very desirable opening on that plane throughout its operational life, which can extend from 20 to 30 years.
To secure these places, GE is involved in fierce competition from the sector’s competitors, such as RTX’s NYSE: RTX Prattienie. This intense environment often leads to an aggressive pricing and a very thin margin on primary devices. The real prize is not one time treatment, but the expansion of the company’s installed base of the company is about 45,000 commercial motors. This fleet is so enormous that it occupies three out of four commercial trips.
This model, however, is not without risks. Gee is linked to putting new “blades” directly to the health of production and the stability of Boeing and Airbus. Any slowdown in the factory or organizational production covers, such as those currently affecting the maximum of 737 line, can create the bottleneck. These external factors can delay Gee’s ability to develop its fleet, which confirms that the strategy is a long -term investment that accepts the lowest returns of greater and more reliable reward on the road.
“Certificates”: within the annual service of 140 billion dollars
Once the engine is in the service, the profitable “blades” part begins from the model, generating a fixed stream of high margin revenue for upcoming contracts. This post -sales work is a gee profitation and is based on many major components that close customers.
- Store visits and service agreements: For safety and performance, jet engines require mandatory and comprehensive reforms called “store visits” after a specific number of flights and courses. To capture this work, GE signs most airlines on long -term service agreements (LTSAS). These contracts, which are often at an hour per hour, work as golden sounds, creating a predictable revenue flow much less than new equipment sales.
- HD spare parts: The engine is a complex set of high -tech ingredients, many of which have a limited age and must be replaced to maintain the validity of the aircraft. This creates a continuous demand for spare spare parts, a profitable slice that its revenues grew more than 20 % in the first quarter of 2025. The LAP engine fleet, which was relatively small, is now entering the first major service courses, with an increase in the outdoor store visits by more than 60 % on an annual basis, indicating a large wave of future mountain revenues.
Financial strength of this model is undeniable. In the first quarter of 2025, the GE engines and commercial services sector recorded 27.5 %, a number that is almost completely moved by the post -sales power. Establishing the entire work is 140 billion dollars accumulate commercial servicesA huge pipeline of the guaranteed future work is contractual.
Pricing in return for decades
Understanding this business model is necessary to understand the GE shares evaluation. The ratio of the price to the distinguished profits of the company (P/E) of about 37 is not typical for the traditional industrial company; It is a feature of a company with solid and high -end services that provides a financial vision for years in the future. GE Aerospace Community and the market are happy in the reliability of after -sales revenue.
GE Aerospace Stock Expectations today
221.15 dollars
7.43 % negative sideModerate purchase
Based on 12 analyst classifications
| The current price | 238.91 dollars |
|---|---|
| High expectations | $ 275.00 |
| Average expectations | 221.15 dollars |
| Low expectations | 190.00 dollars |
GE Aerospace’s arrival details
This ability to predict is a direct pipeline for a strong and consistent cash flow, one of the most important measures for investors. This cash generation is what funds Gee’s ability to invest in the technology of the next generation, such as Rise Riseatable Engine, while providing concrete returns to shareholders.
The company’s plan to publish more 8 billion dollars in 2025 through profits and Share re -purchasing operations It is a direct result of the cash -generating force of this service model.
For investors, the key is to look at the command commands for new engines. This is just a ticket for the main event. It is better to measure the real health of Geospace by monitoring the growth of accumulated services, the rate of global flights, which feed the demand, and the ability of management to move in the supply chain to provide its promises.
This post -sales castle is the real engine of GE’s financial power and its mechanism to install the value of the shareholders.
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