GE Aerospace, a major industrial company, is now the best stock for long-term investments. It has surpassed Rolls-Royce Holdings PLC, (LON: RR).
Chris Smith, Portfolio Manager at Artisan Partners says that GE Aerospace’s new leap engine could revolutionize aviation, powering up to 80% of all new narrow body planes within the next 10 years.
What makes GE Aerospace stand out?
GE Aerospace’s leap engine is expected to be the dominant narrow body aircraft engine in the future.
GE currently offers a modest yield on its shares of 0.64%. This adds to the appeal they have for investors who are looking at long-term investments.
Boeing’s quality issues and delays in deliveries this year have unintentionally boosted GE Aerospace’s prospects.
The demand for GE products is increasing as airlines are opting to maintain older aircraft.
This change has positioned GE to be a leader in the industrial sector.
Smith notes also that TransDigm Group Inc., (TDG), continues to profit from Boeing’s failures. Its stock is up almost 40% in the past year.
Wall Street rates TransDigm at “overweight” with an average target price of $1.465, indicating further upside potential.
Considering GE Aerospace as an investment? What the analysts have to say
Smith thinks that now is the right time to invest in GE Aerospace. This is especially true as US manufacturing reshores and the reliance on international supply chains decreases. The rapid growth of domestic manufacturing is a good indicator for GE’s future.
In its earnings report for July, GE Aerospace beat Street expectations. The company ended the quarter with orders totaling $11.2 billion, an 18% year-over-year increase.
Lawrence Culp, CEO of the company, has increased its full-year forecast. He now projects an operating profit up to $68 billion, and adjusted earnings per share guidance from $4.05.
Wall Street analysts have a “buy” consensus rating for GE Aerospace and a price target average of $196. The analysts are confident in GE Aerospace’s position and growth in the aerospace industry. This could mean a 13% increase from its current price.
GE Aerospace is a great investment in industrial sectors because of its innovative leap engine and favorable market conditions.
The post GE Aerospace vs. Rolls-Royce – Why Analysts Favor GE As the Leading Industrial Stock may be updated as new developments unfold.
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