Balanced Outlook on StandardAero, Inc.: Hold Rating Amid Strategic Expansion and Margin Constraints

Analyst Ronald Epstein from Bank of America Securities reiterated a Hold rating on StandardAero, Inc. (SARO – Research Report) and increased the price target to $33.00 from $30.00.

Ronald Epstein has given his Hold rating due to a combination of factors influencing StandardAero, Inc.’s current market position and future potential. The company is recognized as a well-managed provider in the maintenance, repair, and overhaul sector, particularly with its focus on expanding capabilities for LEAP, CFM56, and CF34 engines. This strategic pivot is expected to support long-term revenue growth and provide some insulation from the volatility in passenger travel.

However, Epstein notes that while these efforts are commendable, the company’s positioning primarily in the aftermarket sector may limit its margin upside. The emphasis on “wrench-turning” rather than “part-making” could restrict profitability growth. Additionally, while investments in next-generation engines and component repairs are promising, they come with near-term margin pressures due to associated costs and learning curves. These factors collectively contribute to the Hold rating, reflecting a balanced view of potential growth against current limitations.

According to TipRanks, Epstein is a 5-star analyst with an average return of 15.1% and a 65.17% success rate. Epstein covers the Industrials sector, focusing on stocks such as Boeing, General Dynamics, and RTX.