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Thesis: Safran: the story is balanced — Global revenue passenger kilometers (RPK) and flight hours: directly drives aftermarket utilization and spare parts…
★ Analysts see FY2026 revenue reaching $35.3B — +17.7% growth in a single year.
What Moves the Stock
1Global revenue passenger kilometers (RPK) and flight hours: directly drives aftermarket utilization and spare parts consumption across 30,000+ installed LEAP/CFM56 engines
2Airbus A320neo and Boeing 737 MAX production rates: each incremental aircraft adds $12-15M engine revenue plus $35-40M NPV aftermarket stream
3LEAP engine shop visit rates and time-on-wing performance: longer intervals between overhauls compress near-term service revenue but improve long-term economics
4Aftermarket pricing and contract renewals: annual 2-4% price escalation on spare parts and labor rates drives margin expansion
5Free cash flow conversion: target €4-5B annually with 90%+ conversion from net income, supporting €2-3B annual shareholder returns
6Aircraft propulsion aftermarket services (~45% of revenue): spare parts, maintenance contracts, engine overhauls for CFM56 and LEAP engine families
7Aircraft propulsion OEM (~25% of revenue): new engine deliveries tied to Airbus A320neo and Boeing 737 MAX production rates
8Aircraft equipment (~20% of revenue): landing gear, nacelles, electrical systems, cabin interiors sold to OEMs and aftermarket
growth-at-reasonable-price (GARP) - Combines 8-12% long-term revenue growth from air traffic recovery and fleet expansion with 15-18% FCF…
moderate - Rising rates have three offsetting effects: (1) negative valuation multiple compression for long-duration aftermarket cash flows…
Watch on earnings: IATA global revenue passenger kilometers (RPK) monthly data: leading indicator for aftermarket demand with 2-3 month lag, Airbus and Boeing monthly order and delivery reports: LEAP engine content on 100% of A320neo and 737 MAX deliveries, Brent crude oil prices: jet fuel represents 25-30% of airline operating costs; sustained prices above $90/bbl pressure airline profitability and aftermarket spending.
One Sentence Summary:
Safran: the story is balanced — global revenue passenger kilometers (rpk) and flight hours: directly drives aftermarket utilization and spare parts consumption across 30.
Auto-composed from Stock Alarm intelligence, financial statements, and analyst estimates. Not investment advice.