General Electric vs. Joby Aviation: Which Industrials Stock Is a Better Buy in 2026?

The aviation landscape is shifting as decarbonization and urban mobility take flight. Should you back the legacy power of GE Aerospace (NYSE:GE) or the disruptive potential of Joby Aviation (NYSE:JOBY)?

GE Aerospace has reinvented itself as a specialized aerospace leader, focusing on jet engines and defense systems. Joby Aviation is a younger rival aiming to revolutionize short-distance travel with its all-electric air taxis. Both companies offer investors a distinct choice between proven industrial stability and speculative high-growth potential.

The case for GE Aerospace

GE Aerospace has transitioned into a specialized engine manufacturer, making it a prominent name among defense stocks and commercial aviation providers. In its latest annual report, filed for the fiscal year ended Dec. 31, 2025, the company detailed its focus on jet and turboprop engines for commercial and military aircraft. The business serves customers in roughly 120 countries and manages a massive installed base of engines that generates recurring service revenue.

In FY 2025, revenue reached nearly $45.9 billion, representing growth of approximately 18.5% over the $38.7 billion recorded in FY 2024. The company reported net income of close to $8.7 billion for the same period. This indicates a net margin of roughly 19%, which measures how much profit a company keeps for every dollar of sales.

As of its December 2025 balance sheet, GE Aerospace reported a debt-to-equity ratio of 1.1x. This ratio compares a company's total debt to its shareholder equity, showing how much it relies on borrowed money. The current ratio, which measures the ability to pay short-term obligations, was 1.0x, and the company generated roughly $7.3 billion in free cash flow, which is the cash remaining after a company pays for its operations and capital investments.

The case for Joby Aviation

Joby Aviation is building an all-electric vertical take-off and landing service to transform urban transportation in markets like New York City and Southern Europe. In its latest annual report, filed for the fiscal year ended Dec. 31, 2025, the company reported having over 2,500 employees. It has secured strategic manufacturing support from Toyota Motor Corporation and maintains defense contracts with L3Harris Technologies (NYSE:LHX).

In FY 2025, revenue reached approximately $53.4 million, representing a sharp increase from the $136,000 reported in FY 2024. Despite this growth, Joby recorded a net loss of nearly $929.8 million as it continues to invest heavily in aircraft development and manufacturing. Its net margin was approximately -1,740.5%, reflecting the high costs of scaling an early-stage transportation company.

As of its December 2025 balance sheet, the current ratio stood at close to 24.1x, indicating significant liquidity for near-term expenses. The company has a debt-to-equity ratio of 0.0x, as its total liabilities are minimal compared to its equity. Free cash flow was roughly negative $563.8 million for the fiscal year, and the company relies on equity tranches and strategic investments to fund its ongoing operations.

Risk profile comparison

GE Aerospace faces risks related to supply chain constraints that could slow down engine production and delivery. Economic downturns frequently impact the commercial aviation sector, potentially reducing demand for new aircraft and maintenance services. The company also operates in a highly competitive defense environment where government budget shifts can impact multi-year contracts.

Joby faces significant regulatory hurdles as it seeks final FAA type certification for its aircraft. Any delays in securing these authorizations could postpone the commercial launch of its air-taxi service. The company also competes with rivals like Archer Aviation (NYSE:ACHR) and faces the challenge of building out the necessary infrastructure for its urban networks, such as landing pads. Financial risks include dependencies on investment tranches from Toyota Motor Corporation.

Valuation comparison

GE Aerospace trades on its Forward P/E, which compares price to future earnings estimates, while Joby Aviation is valued by its P/S ratio, measuring price against sales.

Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.

Which stock would I buy in 2026?

Both of these stocks are compelling investments and offer investors two ways to invest in the future of aviation. As with many other investment choices, it comes down to whether you prefer proven returns or a greater opportunity for long-term upside. Here's why.

GE Aerospace is an established, profitable company with a long history of producing equipment for commercial air travel and military defense, a sector with steady demand. It already has an enormous number of engines in use, which generates recurring service revenue. The company rewards its investors with steady earnings and dividends. But its shares trade at a premium, and its business is vulnerable to supply chain issues.

Joby is more of a speculative investment because its core product isn't in widespread use yet. It is developing electric verticle takeoff and landing aircraft for air taxi service. The company has been making meaningful progress toward commercializing this product, but it's awaiting FAA certification -- and even then, its success depends on consumer adoption of its vehicles. In the meantime, it's burning cash on product development and manufacturing.

So, while neither stock is risk-free, GE remains the more proven business and offers the best balance of earnings versus risk. Joby's future appears bright, but I would only consider a small, speculative position in a diverse portfolio.

Pamela Kock has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends GE Aerospace and L3Harris Technologies. The Motley Fool has a disclosure policy.