GE Aerospace dividend could soar as free cash flow takes flight

Core Viewpoint - GE Aerospace is experiencing significant financial growth, with free cash flow conversion exceeding 130%, leading to increased shareholder returns since its spin-off from General Electric in 2024 [1] Financial Performance - The company reported a 26% increase in revenue to $11.3 billion and a 26% rise in operating profit to $2.3 billion for the third quarter [4] - Adjusted earnings per share surged 44% to $1.66 [4] - The stock has returned 71% over the last 12 months, with adjusted earnings expected to grow by 35.6% in 2025 following a 63.7% increase in 2024 [3] Shareholder Returns - GE Aerospace has committed to returning $24 billion to shareholders from 2024 to 2026, representing a 20% increase from initial plans [2] Market Position - The company operates the largest installed base of commercial jet engines globally, with 78,000 engines powering three out of every four commercial aircraft [5] - The extensive fleet generates predictable high-margin services revenue [5] Upcoming Expectations - Analysts forecast revenue in Q4 to increase to $11.2 billion from $9.88 billion year-over-year, with adjusted earnings per share expected to rise to $1.43 from $1.32 [6] Supply Chain Improvements - Services revenue increased by 28% due to improved material availability and increased shop visits, with internal shop visit revenue growing by 33% [8] - Spare parts sales rose by 25% as supply chain constraints eased, and LEAP engine deliveries surged by 40% year-over-year in Q3 [8]