GE Aerospace GE is scheduled to release second-quarter 2026 results on July 16, before market open. The Zacks Consensus Estimate for quarterly earnings is currently pegged at $1.86 per share on revenues of $11.9 billion.
GE’s second-quarter earnings estimates have been stable over the past 60 days. The bottom-line projection indicates an increase of 12.1% from the year-ago number. The Zacks Consensus Estimate for quarterly revenues indicates year-over-year growth of 16.8%.
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Earnings Surprise History
GE Aerospace has an impressive earnings surprise history. The company’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 13.6%. In the last reported quarter, it delivered an earnings surprise of 15.5%.
Earnings Whispers for GE
Our proven model predicts an earnings beat for GE this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Earnings ESP: GE Aerospace has an Earnings ESP of +2.79% as the Most Accurate Estimate is pegged at $1.91, higher than the Zacks Consensus Estimate of $1.86.
Zacks Rank: GE presently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
GE Aerospace Price and EPS Surprise
GE Aerospace price-eps-surprise | GE Aerospace Quote
What’s Likely to Shape GE Aerospace’s Q2 Results?
The growing installed base and the higher utilization of engine platforms across commercial and defense end markets are expected to have benefited GE Aerospace in the second quarter. Solid demand for LEAP, GEnx & GE9X engines and related services, supported by growth in air traffic, fleet renewal and expansion activities, is likely to have benefited the Commercial Engines & Services business. Also, the company’s progress under its FLIGHT DECK lean model, including supplier improvements, is expected to have driven its performance. The consensus estimate for the segment’s second-quarter revenues is pinned at $9.13 billion, indicating robust 14.2% growth on a year-over-year basis.
The Defense & Propulsion Technologies business is anticipated to have performed strongly, backed by robust demand for the company’s defense products amid heightened geopolitical tensions and positive airline & airframer dynamics. The growing popularity of GE’s propulsion & additive technologies, critical aircraft systems and aftermarket services is anticipated to have boosted the segment’s performance in the second quarter. The consensus mark for the segment’s revenues is pegged at $3.19 billion, indicating strong 24.6% year-over-year growth.
GE has been making investments to expand and upgrade manufacturing facilities in the United States and overseas. These investments are likely to have enabled the company to boost its operational capacities and cater to the increased demand from its commercial and defense customers. This, along with its focus on operational execution, robust backlog (more than $210 billion at the end of first-quarter 2026) and aim to generate healthy free cash flow, is likely to have bolstered its second-quarter performance.
GE’s multi-year portfolio restructuring actions to rebalance its portfolio toward the aerospace sector allowed it to achieve better operational focus on its core business and financial flexibility. This is expected to have driven its margins and profitability in the to-be-reported quarter.
However, high costs and operating expenses owing to certain projects and research and development activities are likely to have weighed on the company’s margin performance. Supply-chain challenges and labor shortages, especially in the aerospace and defense markets, are likely to have been a spoilsport for the delivery of its LEAP engines.
GE’s Price Performance
GE Aerospace’s shares are up 12.9% in the past three months against the Zacks Aerospace - Defense industry’s 5.3% decline and the S&P 500’s 8.6% growth. Its peers, Northrop Grumman NOC and Howmet Aerospace Inc. HWM, have lost 20.7% and gained 4.9%, respectively, over the same period.
Three-Month Price Performance
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GE Aerospace’s Valuation
GE is trading at a forward 12-month price-to-earnings (P/E) ratio of 44.30X, higher than the industry average of 32.86X. This elevated valuation could make the stock vulnerable to further pullbacks if market sentiment sours. In comparison with GE’s valuation, Northrop Grumman is trading cheaper, while Howmet Aerospace is trading at a premium. Notably, Northrop Grumman and Howmet Aerospace are currently trading at 18.53X and 49.37X, respectively.
Price-to-Earnings (Forward 12 Months)
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Investment Thesis
GE Aerospace's robust and diversified portfolio, encompassing commercial engines, propulsion and additive technologies, along with its strength in the defense aerospace market, is likely to drive its performance. For 2026, GE expects adjusted revenues to grow in the low-double-digit range from the year-ago level.
To add to its strengths, GE continues to reward shareholders with substantial dividends and share repurchases, supported by a strong cash flow and operational excellence.
How Should You Play GE Aerospace Pre-Q2 Earnings?
GE Aerospace's strong foothold and solid momentum in the commercial and defense aerospace markets, driven by solid build rates, wide-body aircraft recovery and robust defense budget, bode well for growth. Given the strength in most of its served markets, the company has built a sound liquidity position that supports its shareholder-friendly policies.
Despite its expensive valuation, given the positive analyst sentiment and its growth prospects, the time appears right for potential investors to bet on this company.
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GE Aerospace (GE): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).