Melrose Industries: The Aerospace Growth Story Just Starting

2025-05-28 05:36:46 ET

Summary

• Melrose Industries remains a compelling long-term buy, supported by strong fundamentals, robust aftermarket opportunities, and successful restructuring.
• The company’s balanced exposure to both civil and defense aerospace, plus a healthy mix of OEM and aftermarket sales, underpins resilient growth.
• Recent earnings highlight double-digit revenue and profit growth, margin expansion, and positive outlook despite supply chain and tariff concerns.
• With debt maturities manageable and free cash flow set to improve, I see 30% upside potential and reiterate my buy rating with a raised price target.

Melrose Industries ( MLSPF ), a key player in engine maintenance for the aerospace and defense industry, has delivered notable outperformance since I initiated coverage in September 2024 with a buy rating. The stock returned 10% to date, exceeding the S&P 500. It also briefly surged to $9, indicating a 51.7% return, exceeding my price target for 2025....

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