Shares of GE Aerospace (GE) declined in pre-market trading as the company continues to face supply chain woes. However, the aerospace company reported strong earnings in the third quarter. The company’s adjusted earnings surged by 25% year-over-year to $1.15 per share, above analysts’ consensus estimate of $1.14 per share.
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Furthermore, the company’s revenues increased by 6% year-over-year to $9.8 billion. This beat analysts’ expectations of $9.02 billion.
GE Aerospace Continues to Face Supply Constraints
Meanwhile, the company reported that while demand for commercial air travel remains strong, it continues to face issues with material availability and supply disruptions. These challenges have affected the company’s ability to produce and deliver equipment and services. As a result, GE Aerospace sold fewer LEAP engines in the third quarter. The company’s LEAP engines are used in the narrowbody aircraft of Airbus (EADSY) and Boeing (BA).
Furthermore, the company cautioned that the effects of supply chain constraints and inflation are likely to persist.
In fact, according to the TipRanks “Bulls Say, Bears Say,” analysts bearish on GE stock had cautioned that lower deliveries of LEAP engine could impact the company’s revenue potential.
GE Aerospace Raises FY24 Earnings Guidance
Looking ahead, management now expects its FY24 revenue to grow in the high single digit while adjusted earnings per share to be in the range of $4.20 to $4.35 per share. For reference, analysts were expecting an adjusted EPS of $4.24.
Is GE a Good Stock to Buy Now?
Analysts remain bullish about GE stock, with a Strong Buy consensus rating based on a unanimous 11 Buys. Over the past three months, GE has surged by more than 15%, and the average GE price target of $209.64 implies an upside potential of 7.9% from current levels. These analyst ratings are likely to change following GE’s results today.
