Why GE Aerospace Stock Soared in January

Core Viewpoint - GE Aerospace has demonstrated strong performance as an independent company, with significant growth in share price and positive earnings outlook following its separation from General Electric [1][2]. Financial Performance - GE Aerospace reported earnings of $1.32 per share on sales of$10.8 billion, surpassing consensus estimates of $1.04 per share on$9.5 billion in revenue, with earnings per share more than doubling and free cash flow increasing over 20% year over year [3]. - The company announced a 30% increase in dividends and plans to repurchase over $7 billion worth of shares in 2025 [4]. Market Outlook - The outlook for 2025 is promising, with orders up 46% year over year, and CEO Larry Culp forecasting double-digit revenue and earnings growth along with strong free cash flow [4]. - GE Aerospace's stock has risen 27% in the last six months, indicating a positive market sentiment and potential for further growth [8]. Industry Context - Approximately 75% of GE Aerospace's sales come from the commercial aerospace sector, which has faced challenges due to issues at Boeing and supply constraints affecting new aircraft production [6]. - The company is expected to benefit from filling existing orders, and the current lack of new planes may lead to higher margins on spare part sales as airlines keep older planes in service longer [7].