This Stock Has No Business Being This Good, and It Just Keeps Going

When General Electric split into three businesses, it was GE Aerospace (NYSE: GE) that kept the iconic ticker "GE". Notably, the CEO who orchestrated the three-way split stayed on to helm GE Aerospace. When you know that, perhaps it isn't as surprising that the company is doing so well. The interesting thing is that the future still looks incredibly promising.

GE Aerospace had a great first quarter

In the first quarter of 2026, GE Aerospace posted adjusted revenue growth of 29% year over year. That drove adjusted earnings-per-share growth of 25% and adjusted cash flow growth of 14%. It was a very strong quarter for a business that serves an industry that is under significant strain today.

Image source: Getty Images.

For example, Spirit Airlines was forced into bankruptcy for the second time. And this time, it chose to liquidate rather than attempt a comeback. It isn't the only company facing financial stress, noting that the founder of JetBlue (NASDAQ: JBLU) has warned that the airline could end up in bankruptcy court, too, even though the company's current CEO disputes that claim. Still, the impact of higher jet fuel prices on the airlines that buy jet engines from GE Aerospace can't be ignored. And yet GE Aerospace continues to post strong financial results.

GE Aerospace's future looks quite bright

In fact, despite the headwind of high jet fuel costs caused by the geopolitical conflict in the Middle East, GE Aerospace saw its orders grow 87% year over year in the first quarter. Building jet engines takes time, so orders often happen well in advance of delivery. And all the engines out there still need to be maintained, which supports the company's service revenues. All in, GE Aerospace's backlog stood at $210 billion. Of that total, $170 billion is related to services, which are an annuity-like income stream.

In fact, the company is so well-positioned right now that management expects to hit the high end of its full-year guidance in 2026. Given the importance of service-related revenues, that optimism seems entirely reasonable. No wonder the stock has been on a fairly steady ascent since General Electric was broken into three businesses in early 2024.

While it is impossible to predict whether investors will continue buying GE Aerospace stock, given its lofty 40x price-to-earnings ratio, the company's huge backlog certainly suggests the business will remain robust for the foreseeable future. And if that's the case, growth investors seem unlikely to suddenly abandon the shares.

Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends GE Aerospace. The Motley Fool has a disclosure policy.