Now is not the time to buy GE Aerospace stock

We believe there is a near-equal mix of good and bad in GE stock given its overall Moderate operating performance and financial condition. But keeping in mind its Very High valuation, we think that the stock is Unattractive. Here is our multi-factor assessment.

But no matter how attractive, investing in a single stock carries high risk. Trefis High Quality Portfolio and is designed to reduce stock-specific risk while giving upside exposure

Let’s get into details of each of the assessed factors but before that, for quick background: GE Aerospace (GE) is a $294 Bil market cap company operating in Power, Renewable Energy, Aviation, and Healthcare, delivering advanced technologies in medical imaging, diagnostics, digital solutions, and drug discovery.

[1] Valuation Looks Very High

This table highlights how GE is valued vs broader market. For more details see: GE Valuation Ratios

[2] Growth Is Inconsistent

• GE Aerospace has seen its top line shrink at an average rate of -4.6% over the last 3 years
• Its revenues have grown 8.8% from $36 Bil to $40 Bil in the last 12 months
• Also, its quarterly revenues grew 10.9% to $9.9 Bil in the most recent quarter from $9.0 Bil a year ago.

This table highlights how GE is growing vs broader market. For more details see: GE Revenue Comparison

[3] Profitability Appears Moderate

• GE last 12 month operating income was $7.5 Bil representing operating margin of 18.8%
• With cash flow margin of 13.2%, it generated nearly $5.2 Bil in operating cash flow over this period
• For the same period, GE generated nearly $7.0 Bil in net income, suggesting net margin of about 17.6%

This table highlights how GE profitability vs broader market. For more details see: GE Operating Income Comparison

[4] Financial Stability Looks Very Strong

• GE Debt was $20 Bil at the end of the most recent quarter, while its current Market Cap is $294 Bil. This implies Debt-to-Equity Ratio of 6.6%
• GE Cash (including cash equivalents) makes up $13 Bil of $124 Bil in total Assets. This yields a Cash-to-Assets Ratio of 10.8%

[4] Downturn Resilience Is Very Weak

GE has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.

2022 Inflation Shock

• GE stock fell 46.8% from a high of $72.17 on 27 May 2021 to $38.40 on 14 July 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 9 March 2023
• Since then, the stock increased to a high of $276.23 on 4 August 2025 , and currently trades at $275.20

2020 Covid Pandemic

• GE stock fell 58.3% from a high of $66.18 on 12 February 2020 to $27.61 on 15 May 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 3 March 2021

2008 Global Financial Crisis

• GE stock fell 84.2% from a high of $211.82 on 2 October 2007 to $33.49 on 5 March 2009 vs. a peak-to-trough decline of 56.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 25 March 2025

But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read GE Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – S&P 500, Russell, and S&P midcap. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.