GE Gains From Strength in Commercial Engines: Can the Momentum Sustain?

GE Aerospace GE is witnessing strong momentum in the Commercial Engines & Services segment. Organic revenues from the segment increased 24% year over year in the fourth quarter of 2025, constituting more than 75% of its business. Also, in the fourth quarter, the segment’s orders increased 76% year over year to $22.8 billion.

A growing installed base and higher utilization of engine platforms, particularly in commercial & defense sectors, have set the stage for GE’s long-term growth. Robust demand for LEAP, GEnx & GE9X engines and services, supported by growth in air traffic, fleet renewal and expansion activities, is proving beneficial for the Commercial Engines & Services segment.

During 2025, the company secured a $5 billion contract from the U.S. Air Force to supply F110 engines, parts and support services as part of a Foreign Military Sales (FMS) program. Also, it received an Indefinite Delivery Indefinite Quantity (IDIQ) contract from the U.S. Army to supply F110 engines for F-15 and F-16 jets used by allied countries. It successfully tested the T901 engine on a Black Hawk helicopter and completed the design review for the new XA102 engine.

GE Aerospace is expected to maintain strong demand momentum going forward, with both commercial and military aircraft programs benefiting from strength in air travel and strong defense budgets.

GE's Peers in the Aerospace Market

Among its major peers, Howmet Aerospace Inc. HWM is benefiting from persistent strength in the commercial aerospace market. Revenues from the commercial aerospace market increased 13% year over year (exceeding $1.1 billion) in the fourth quarter of 2025, constituting 53% of its business. Also, in the first, second and third quarters, revenues from the market increased 9%, 8% and 15%, year over year, respectively.

Its another peer, RTX Corporation RTX, is benefiting from strength in the commercial aerospace market, with growth in both aftermarket and OEM verticals. RTX reported 12.1% sales growth in the fourth quarter, driven by solid momentum in the Collins Aerospace and Pratt & Whitney segments. Rising aircraft utilization and demand for sustainable technologies are supporting RTX Corp.’s growth.

GE's Price Performance, Valuation and Estimates

Shares of GE Aerospace have surged 68.2% in the past year compared with the industry’s growth of 37.4%.

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From a valuation standpoint, GE is trading at a forward price-to-earnings ratio of 42.18X, above the industry’s average of 33.30X. GE Aerospace carries a Value Score of F.

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The Zacks Consensus Estimate for GE’s 2026 and 2027 earnings has been on the rise over the past 60 days.

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The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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