GE Aerospace Soars on Culp's Vision: Why Now is the Time to Board This Jet

Investors, buckle up! GE Aerospace (GEAV) is not just flying—it's rocketing toward a new era of dominance. Under CEO Larry Culp's leadership, this spinoff is proving that separating from legacy businesses was no accident. It was a masterstroke. Let's dive into why this aerospace titan is a must-have for your portfolio now, before Q3 earnings send shares skyward.

Culp's Leadership: The Jet Engine of Growth

Larry Culp isn't just managing GE Aerospace—he's reengineering it. At the Bernstein Conference, he laid out a blueprint that screams “opportunity.” The Flight Deck lean operating model isn't just jargon; it's a 95% supplier on-time delivery rate—up from a dismal 45% just a year ago. That's not incremental; that's a transformative efficiency boost. Pair this with $3B annually in R&D (6-8% of revenue), and you've got a company that's not just keeping pace with the industry—it's setting the pace.

The RISE program alone is a game-changer: a 20% jump in fuel efficiency for narrow-body engines by 2030. Imagine airlines slashing fuel costs while GEAV cashes in on retrofits and new orders. Culp's focus on operational execution—SQDC (Safety, Quality, Delivery, Cost)—isn't just a slogan. It's a profit engine. And don't miss the X100 adaptive cycle engine, which just passed testing. This tech is primed to power next-gen fighter jets, locking in decades of defense contracts.

Market Tailwinds: Riding the Recovery and Defense Surge

The skies are opening up! Post-pandemic travel demand is booming, and GEAV's 75% share of global commercial departures means it's front and center. With over 45,000 commercial engines in service, recurring revenue from maintenance, repair, and overhaul (MRO) is a cash cow. Services revenue jumped 30% in 2024, and Culp's team isn't stopping there. They're expanding work scopes on legacy engines like the CFM56, turning time on wing metrics into profit. A Qatar Airways order for 400+ engines—the largest wide-body deal in GE's history—is just the tip of the iceberg.

On the defense front? Fire the engines! With global military spending hitting record highs, GEAV's $20B DPT backlog is a goldmine. The XA100 engine for F-35s and the X102 program for sixth-gen fighters mean this division isn't just steady—it's explosive. The U.S. Air Force just handed GEAV a $5B contract for F110 engines. This isn't a fluke; it's a strategic win with Culp's administration ties sealing the deal.

Valuation: Cheap at These Heights?

GEAV's $180B backlog is a fortress, and its high-single-digit CES growth is just getting started. With 23.8% operating margins and a 30% EPS surge in Q1, this stock is flying under the radar. Analysts are pricing in low-double-digit revenue growth for 2025, but here's the kicker: $500M in tariffs are already factored in. That means upside if they overperform on cost savings.

At current prices, GEAV trades at 12x forward earnings—a steal compared to peers like Raytheon (RTX) or Boeing (BA). And with $6.8B in free cash flow guidance, this isn't a growth story; it's a cash-printing machine.

Catalysts: Igniting the Afterburners

• Paris Air Show (June 2025): GEAV's RISE and Open Rotor tech (targeted for 2035-2040) will steal headlines. New deals here could send shares soaring.
• Q3 Earnings: Watch for LEAP engine deliveries (up 15-20%) and services orders. A beat on margins or backlog growth could trigger a rally.
• Trade Policy Wins: Culp's push to end tariffs is gaining traction. A tariff rollback would be a $500M+ tailwind—pure profit upside!

Bottom Line: Climb Aboard Before Liftoff

GE Aerospace isn't just a spinoff—it's a reinvention. With Culp's operational genius, a $180B backlog, and tailwinds from travel and defense, this stock is primed for a multi-year run. The math is simple: buy now before the Paris deals flood in and Q3 earnings ignite FOMO. This isn't a bet on the future—it's a buy-the-dip opportunity in an industry that's roaring back to the skies.

Action Item: Buy GEAV now. Set your sights on $250+ by year-end. If you miss this lift-off, you'll be stuck on the tarmac while others soar.