通用电气（GE）：巴西山区MRO瑰宝

4.604.60 2025E2026E39,207.844,466.25.606.6539,665.743,850.55.526.48 2027E48,697.47.6547,523.57.47 Sheila Kahyaoglu * | Equity Analyst+1 (212) 336-7216 | sheila.kahyaoglu@jefferies.comKyle Wenclawiak * | Equity Associate+1 (212) 323-7671 | kwenclawiak@jefferies.comSource: Company data, Jefferies estimates The Long View: General ElectricInvestment Thesis / Where We DifferThe GE Aerospace portfolio is a market leader with 70% aftermarket exposure,competitive OE share with the LEAP (>50% on A320neo) and GEnx (>80%on 787), and a cash-generative model that reinforces existing balance sheetstrength. We see continued upside to top line and segment profitability fromthe narrowbody AM (CFM56 and LEAP), pricing muscle, and lean/kaizenproductivity gains. Capacity to deploy cash for the dividend yield and accretiveshare repurchases or M&A is a new chapter for GE Aerospace as a standalonecompany following the GE Vernova spin in early April 2024.Base Case,$260, +16%•2026E sales increase 13%y-o-y after 12%growth in 2025 (guide LDD).•CES grows 15% in 2025E and 13% in 2026E,drivenby Services 14%/12%and Engines18%/18%.•D&PT grows 8%/10% in '25/'26E.•Op margins +50 bps to 21.1% in 2025, and +20bps to 21.3% in 2026; $1.1BB/$1.1BB of profitdollar growth in '25/'26E.•FCF of $6.66BB/$7.75BB in '25/'26E.•2026E Adj. EPS of $6.65, up 19% y-o-y.•PT $260: 1) 26X 2026E EBITDA of $10.5BB; 2)40X P/E 2026E EPS of $6.65, and 3) 2.9% yieldon 2026E FCF of $7.7BB.Sustainability MattersTop Material Issue(s): 1) Production Design & Lifecycle Mgmt:GE is developing: CFM RevolutionaryInnovation for Sustainable Engines (RISE) program to achieve at least 20% lower fuel consumption andemissions from current engines; Airbus-CFM effort to flight test hydrogen-powered jet engines for EIS by2035; and effort with NASA and Boeing to develop and fly a megawatt-class hybrid electric propulsionsystem. GE's current engine offerings are capable of using SAF for passenger operations.Company Target(s): 1)Achieve carbon neutrality for Scope 1 and Scope 2 emissions by 2030;2)Achievenet zero by 2050 for the Scope 3 emissions from use of sold products;3)100% pay equity.Qs to Mgmt: 1)How are you thinking about your role in facilitating the energy transition across theAerospace and Vernova businesses from the regulatory, product offering, and perspectives?2)Howdoes the transition from combustion to hybrid electric/hydrogen engines affect existing processes andinfrastructure both internally and for operators?Please see important disclosure information on pages 19 - 24 of this report.This report is intended for Jefferies clients only. Unauthorized distribution is prohibited. Upside Scenario,$305, +37%•2026E sales increase high-teens y-o-y on betterCES throughput for both Services and Engines,plus pricing. D&PT accelerates.•Op profits above $10BB in 2026E and achieve >$11.5BB in 2028E.•CFM56 extended lives; LEAP profitable ramp;successful GE9X launch.•Announcements on next-gen progress withRISE, Adaptive.•2026E FCF $8BB+ for repurchases & dividendraise; accretive M&A.•PT $305: 1) 22X 2028E EBITDA. Downside Scenario,$125, -44%•2026E sales decelerate to MSD y-o-y as supplychainaffects Services and Engines ramps,along with D&PT.•$10BB op profit target in 2028E is delayed dueto higher costs, worse Services drop-through,and limited productivity gains.•2026 FCF is pressured by CSA collections,capexheadwinds,and profitability;limitedincremental shareholder returns.•Management change.•PT $125: 1) 12X 2028E EBITDA.Catalysts•>$10BB of operating profits by 2028•Tariff mitigation of $0.5BB identified•Time-on-wing solved on LEAP-1A/1B with HPTdurability kit•CFM56 shop visits higher than anticipatedgiven market conditions•LEAP Services revenues and margins ramptoward CFM56 levels•GE9X moves down learning curve quickly•Supply chain stabilization•Award for NGAP•T901 retrofits for Black Hawk and Apache 2 Investment ConsiderationsIn this note, we highlight the following:•1. GE Celma Responsible for ~25% of GE Shop Visits with Ongoing Expansion for LEAPOverhauls•a) Commercial Services:13% Growth in 2025 with >$140BB Backlog and 1.3X T12MBook-to-Bill De-Risking 2025•b) A Walk Through the Factory - The Day Starts in the Obeya Room and Ends in theTest Cell•2. Price Target & Valuation1. GE Celma Responsible for ~25% of GE Shop Visitswith Ongoing Expansion for LEAP OverhaulsTheGE Celmasite was founded in 1951 as a fan manufacturer and expanded to service commercial& Brazilian Air Force engines in the 1960s. The site was privatized again in 1991 before GE fullyacquired it in 1996. Along with MRO capability, the site formerly produced CF34 engines for Embraeraircraft with >500 engine deliveries, although this work transitioned to North Carolina around 2014.Today, GE Celma employs ~3,000 workers across five sites in Brazil, including the Petropolis MROplants (which we toured), a test cell at the international airport in Rio de Janeiro, and the Tres Riossite that opened in 2018 with a test ce