GE stock pops as profit beats amid 'rapid growth' in aviation business
GE (GE) stock rose more than 6% on Tuesday to close at $113.62 per share after the industrial icon posted a quarterly profit beat and raised guidance, citing its fast-growing aerospace business.
“GE Aerospace continues to experience rapid growth, driven by robust demand and solid execution, largely in commercial engines and services,” CEO Larry Culp said during the company’s earnings call.
The maker of jet engines now expects 2023 adjusted earnings of $2.55 to $2.65 a share, up from a prior projection of no more than $2.30.
While navigating supply chain issues, the industrial giant's year-to-date commercial engine deliveries are up 30%.
On the call, Culp also noted GE’s growth potential beyond the commercial category, highlighting its deal with the US Army for test engines involving the Future Attack Reconnaissance Aircraft prototypes.
GE's adjusted earnings per share came in at $0.82 versus Wall Street expectations of $0.56 per share.
The third quarter results are the culmination of Culp’s five-year-turnaround plan, an aggressive initiative to cut costs and divest businesses.
The last major step will be the spin-off of GE Vernova, its renewable energy unit. That business is expected to spin off at the beginning of the second quarter of 2024, under the ticker symbol GEV.
Through restructuring and asset sales, GE has reduced debt by more than $100 billion since 2018. In 2020 the company completed the sale of its iconic lighting business. In January 2023, GE HealthCare was spun off and began trading on the Nasdaq.
Once the the renewable unit is spun off, GE will be focused on its aviation business, called GE Aerospace. It will continue to be listed as GE on the New York Stock Exchange.
Wall Street has been cheering the conglomerate's slim-down. The stock is up roughly 60% year to date versus the broader market's 11% rise. Shares are up nearly 100% from exactly one year ago.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre.
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