Bull of the Day: GE Aerospace (GE)

Soaring over +280% in the last year, GE Aerospace GE is a portfolio-worthy stock that investors may be more inclined to pay a premium for after a pullback from an all-time high of $332 a share in early January.Commercial fleet modernization and active global military aircraft operations have made GE stock a very viable investment, and a further bounce back toward its highs could be in store after impressively exceeding Q4 expectations last month (January 22).GE's Q4 results were powerful as demand for its jet engines and services surged, while execution improved across factories, with both commercial and defense segments delivering higher output and profitability.Image Source: Zacks Investment Research Strong Q4 Results & Earnings Track Record  Robust orders, strong aftermarket activity, and better material availability all contributed to GE impressively beating Wall Street’s Q4 expectations.Higher shop visit volumes and expanded aftermarket services boosted revenue, including strong engine maintenance demand for its popular LEAP and CFM56 engines. Beating quarterly sales and EPS expectations by 5% and 9%, respectively, GE’s top and bottom lines stretched more than 18% year over year to $11.86 billion and $1.57 per share.   Illustrated by the green arrows in the above Price, Consensus, and Surprise chart, GE has now exceeded the Zacks EPS Consensus for 13 consecutive quarters, posting a very impressive average earnings surprise of 14.27% in its last four quarterly reports, as shown below.Image Source: Zacks Investment Research GE’s Massive Backlog & Positive EPS GuidanceMore compelling is that GE’s total backlog reached roughly $190 billion, up nearly $20 billion year-over-year. This comes as orders during Q4 were up 74% to $27 billion, also reflecting strong customer demand.Emphasizing operational optimization and margin expansion, GE guided FY26 EPS in a range of $7.10-$7.40, which would reflect 11%-16% growth from adjusted earnings of $6.37 per share last year. GE’s Compelling EPS RevisionsCuriously compelling, the consensus for GE’s FY26 EPS has risen above its guidance range in the last seven days to estimates of $7.45 compared to $7.15 a week ago. Supportive of upward movement in GE stock is that FY26 and FY27 EPS estimates have now risen over 6% in the last two months.Notably, FY27 EPS projections of $8.55 would reflect 200% growth in the last five years, with GE’s annual earnings at $2.81 a share in 2021.Image Source: Zacks Investment ResearchCorrelating with the continued outperformance of GE stock, the year-ago estimate picture shows that FY26 and FY27 EPS revisions have now increased over 14%, respectively.Image Source: Zacks Investment Research Bottom LineUpside bias regarding GE Aerospace's profitability remains intact despite its slightly elevated 40X forward earnings multiple.Reassuring to its operational performance is the aerospace leaders' expectations of revenue acceleration, strong cash flow, and an adequate balance sheet that carries over $12 billion in cash and $130 billion in total assets versus $111 billion in total liabilities.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GE Aerospace (GE): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks