GE Aerospace (GE) Intrinsic Value & DCF Valuation
Aerospace & Defense · NYSE
Current Price
$303.62
Intrinsic Value
$323.88
+6.3% margin of safety
What Is GE Aerospace's Intrinsic Value?
As of 2026-10-07, the base-case DCF model estimates the intrinsic value of GE Aerospace (GE) at $323.88 per share, compared with a market price of $303.62, a margin of safety of +6.3%. The base case assumes 12.9% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $272.07 to $382.51. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is GE Aerospace (GE) Undervalued?
At $303.62, GE trades about 6.3% below the base-case intrinsic value estimate. That is a real discount, but it stays short of the 30% margin of safety required before calling a stock undervalued.
COMPETITIVE MOAT
↑Dominant Commercial Engine Market Share
GE Aerospace holds a commanding position in the commercial aircraft engine market. This scale provides significant advantages in R&D, manufacturing efficiency, and aftermarket services.
↑Long-Term Service Agreements
Extensive long-term service agreements create high switching costs for airlines. These contracts lock in aftermarket revenue and customer loyalty for decades.
↑Defense Sector Relationships
Deeply entrenched relationships with defense contractors and governments offer a stable, recurring revenue stream. These partnerships are difficult for competitors to replicate.
INVESTMENT RISKS
↓Geopolitical Instability
Global conflicts and trade tensions can disrupt air travel and defense spending. This uncertainty poses a risk to GE's revenue streams and future order book.
↓Technological Disruption
Emerging technologies like sustainable aviation fuels and electric propulsion could eventually alter the aerospace landscape. GE must adapt to these shifts to maintain its competitive edge.
↓Regulatory Scrutiny
The aerospace industry faces stringent safety and environmental regulations. Changes in these regulations could increase compliance costs and impact product development.
Base case
GE base case valuation
Intrinsic Value
$323.88
Margin of safety
+6.3%
Expected annual return
+1.3%
Base case assumptions: 12.9% annual growth, 10.0% discount rate, 30x exit multiple, 5 year projection. Data as of 2026-10-07.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the GE valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for GE Aerospace respond.
Open DCF Calculator for GECompany Overview
Based in Evendale, Ohio, GE Aerospace is a prominent American aviation enterprise with roots tracing back to its 1878 founding by Thomas Alva Edison. The company specializes in manufacturing and supplying jet and turboprop engines, along with integrated systems, for an extensive range of aircraft, including those in commercial, military, business, and general aviation use. Its robust brand lineup features Avio Aero, Unison, GE Additive, and Dowty Propellers. GE Aerospace organizes its activities into two core segments: Commercial Engines & Services, and Defense & Propulsion Technologies. The Commercial Engines & Services division oversees the design, development, production, and maintenance of jet engines for commercial airframes, business aviation, and aeroderivative applications. Meanwhile, the Defense & Propulsion Technologies segment is dedicated to providing vital engines and critical systems for defense-related aerospace needs.
Financial Metrics — GE Stock Valuation Data
Revenue/Share (TTM)
$48.75
FCF/Share (TTM)
$8.08
ROIC (TTM)
10.4%
ROE (TTM)
49.0%
P/FCF
37.5x
EV/EBITDA
25.7x
FCF Yield
2.69%
Debt/Equity
1.09x
Based on trailing twelve-month data, GE shows a free cash flow per share of $8.08 and a ROIC of 10.4%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 37.5x and FCF yield of 2.69% are important context metrics when evaluating GE's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of GE?
GE Aerospace currently generates $8.08 in free cash flow per share. At the current price of $303.62, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is GE undervalued?
GE trades at a P/FCF ratio of 37.5x with a free cash flow yield of 2.69%. This P/FCF is in a moderate range. However, whether GE is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value GE stock using DCF?
To perform a DCF valuation on GE Aerospace: (1) Start with the trailing free cash flow per share ($8.08) as the base, (2) project future FCF growth over 5-10 years based on Aerospace & Defense industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting GE's risk profile — with a debt-to-equity of 1.09x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to GE?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For GE Aerospace, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Aerospace & Defense trends, then discounting those amounts to today's dollars. GE's ROIC of 10.4% shows moderate capital returns.
How does WACC affect GE stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For GE, with a debt-to-equity ratio of 1.09x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 25.7x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See GE PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Industrials valuationsDCF and P/E value GE with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-10-07. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.