Guidance and 2027 services growth rose, but GE9X losses offset some of it. I model $9.20 of 2027 earnings at 36 times, a $330 stock, a market-like return from $301.
Key points
- $9.25 billion company-defined 2026 free cash flow at the midpoint of the October 20 raise.
- $8.05 2026 adjusted EPS at the new midpoint, versus $7.75 in July.
- Low-double-digit commercial-services growth is now the 2027 plan, with about $300 million more GE9X losses.
The call
The price of $301 requires 2027 adjusted EPS near $8.15 if the multiple stays at 37 times 2026 earnings. That path needs services to convert the backlog without a further GE9X hit or multiple fade after a 12% three-month decline.
I believe services volume and pricing deliver $9.20 of 2027 EPS, but the multiple eases to 36 times as passenger traffic stays soft and CPP debt is still a year away. That is a $330 stock, a market-like return.
Adjusted EPS: reported path vs 2027 estimateCompany adjusted EPS through 2026 guidance; 2027E is mine. As of Oct 20, 2026.
Valuation
| Item | Figure |
|---|
| 2026 adj. EPS (guidance mid) | $8.05 |
| 2027 adj. EPS (my estimate) | $9.20 |
| 2027 FCF (my estimate) | $10.4 billion |
| Shares in 12 months | 1.02 billion |
| Multiple on 2027 EPS | 36 times |
| 12-month target | $330 |
A 36 times multiple sits below the 37 times 2026 print the stock carries today and still above a 32 times FCF multiple on about $10.20 a share. Upside to $360 if the multiple holds; downside to $290 if growth slips to 10%. That band is why the rating is hold, not buy.
Company-defined free cash flow ($ billions)- Company FCF
- My 2027 estimate
Guidance raised Oct 20, 2026. 2027E is mine.
Risks
- Spare-parts delinquencies keep rising and shop capacity cannot catch demand.
- IATA traffic stays negative and shop visits slow in 2027.
- CPP close in 2027 adds leverage without the promised capacity.
What would change my mind
January 2027 guidance that puts commercial-services growth below high single digits.