GE Aerospace (GE) could raise its 2026 adjusted EBIT guidance by about $500 million as strong services demand supports results, though supply limits and slower growth in 2027 may weigh on investor sentiment, RBC Capital Markets said.
The company is expected to report its Q2 results Thursday.
RBC expects Q2 services revenue to rise 19% and full-year services growth to reach 18%, helped by spare-parts demand, older engines staying in service and limited industry capacity, adding that GE Aerospace is expected to deliver about 2,100 LEAP engines, but said tight supplies and long repair times leave little room for delays or other problems.
The Iran conflict and higher oil prices have not yet reduced passenger travel enough to weaken aircraft maintenance and parts spending, according to the note Tuesday.
RBC said it does not expect the Q2 report to lift the shares because investors may have already priced in strong results and a higher outlook, saying that attention is shifting to 2027, when services growth may slow as the company compares against stronger prior-year results.
The investment firm said the broader aerospace supply chain remains tight, although improving material availability should support both services sales and new engine deliveries.
RBC maintained its outperform rating and raised its price target to $400 from $355.
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