Wolfe Research raised the price target for General Electric (NYSE:GE) from $107 to $125, reaffirming its Outperform rating. As a result, shares gained more than 2% intra-day today.

The analysts explained that the fiscal year 2025 provides a more accurate representation of the company's typical earnings power, and this year serves as the basis for their valuation framework.

The analysts stated that they have updated their Commercial OEM (Original Equipment Manufacturer) delivery forecasts and adjusted the EBIT (Earnings Before Interest and Taxes) bridge to account for a slightly heavier adverse mix between OEM and AM outgrowth. However, they noted that the losses from the LEAP program are narrowing.

As a result, the projected EBIT for 2023 remains unchanged at $5.7 billion, which is at the higher end of the guidance range. The estimated EBIT for 2025 has been increased by approximately 3% to $7.8 billion. The analysts expressed expectations that management will slightly exceed the 20% margin target over that timeframe.