Analyst Kristine Liwag from Morgan Stanley reiterated a Hold rating on StandardAero, Inc. and keeping the price target at $32.00.
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Kristine Liwag’s rating is based on a combination of factors that reflect both positive and cautious elements in StandardAero, Inc.’s current situation. The company has shown strong demand in the engine maintenance, repair, and overhaul (MRO) sector, with robust growth in its LEAP and CFM56 programs. This includes a significant backlog and expansion in OEM-authorized repairs, which are positive indicators for future growth.
However, despite these strengths, Liwag maintains a Hold rating due to the company’s ongoing efforts to renegotiate long-term contracts to eliminate low-margin pass-through revenues. While these changes are expected to improve margins and working capital in the long run, they will also result in a reduction of revenue by approximately $300-400 million in 2026. This balance of strong demand and strategic adjustments leads to a cautious outlook, justifying the Hold rating.
In another report released yesterday, UBS also maintained a Hold rating on the stock with a $35.00 price target.