Episode
GE Aerospace Stock: It Beat Earnings and RAISED Guidance Again — So Why We Say HOLD
- Published
- Jul 17, 2026
- Duration seconds
- 825
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Summary
GE Aerospace (GE) Q2 2026 — GE Aerospace (GE), the pure-play jet-engine giant carved out of the old General Electric, reported a strong Q2 2026: adjusted EPS of $2.02 beat the ~$1.86 estimate (+22% YoY) on adjusted revenue of $12.6B (+24%), orders jumped 17% to $16.5B, operating profit rose 18% to $2.7B, and free cash flow surged 43% to $3.0B. Management RAISED full-year 2026 guidance again — adjusted EPS to $7.65–$7.85 and free cash flow to $8.9–$9.2B — backed by a $210B+ backlog. The stock (~$354, up ~2.4% on the print) has nearly doubled off its $255 low and sits ~8% below its $383 high. The catch: at ~45x forward earnings and ~41x free cash flow, even our optimistic aftermarket-compounder DCF lands near $290 — below the price. Our call: HOLD. GE Aerospace is one of the market's great comeback stories — the old General Electric, broken up and reborn as a focused, ~$370B pure-play jet-engine maker led by Larry Culp. Q2 2026 was a genuinely strong quarter: adjusted EPS of $2.02 beat the ~$1.86 estimate (+22% YoY), adjusted revenue rose 24% to $12.6B, orders jumped 17% to $16.5B, free cash flow surged 43% to $3.0B, and — for the second time this year — management RAISED full-year guidance across the board (adj EPS $7.65–$7.85, FCF $8.9–$9.2B, revenue growth to the high-teens). The engine of the beat was the aftermarket: with 70,000+ engines in service (~70% of revenue is high-margin services) and a $210B+ backlog (~$170B of it contracted commercial services), GE is a razor-and-blades annuity firing on all cylinders. So the debate isn't quality — it's price. The stock has nearly doubled off its $255 low to ~$354, ~45x forward earnings and ~41x free cash flow. Even giving GE the optimistic aftermarket-compounder path (13%→7% FCF growth) AND a premium, quality discount ra…