SAFRY - GE Aviation Is Still A Fantastically Valuable Business
- GE Aviation's revenue, earnings, and cash flow have plummeted in 2020 due to the COVID-19 pandemic.
- Engine makers like GE Aviation generate most of their profit and cash flow from aftermarket services, not selling the engines themselves.
- Most of the engines delivered during the production boom of the past decade haven't even started generating service revenue.
- Aircraft utilization will return to normal over the next 2-3 years, driving a quick return to growth for GE Aviation's services business.
- GE Aviation annual free cash flow could still reach $6-$7 billion by mid-decade.
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GE Aviation Is Still A Fantastically Valuable Business