Bank of America Securities analyst Ronald Epstein has reiterated their neutral stance on SARO stock, giving a Hold rating on November 12.
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Ronald Epstein’s rating is based on a combination of factors, including StandardAero’s strategic investments and current market positioning. The company has shown potential for long-term revenue growth through its expanding services portfolio, particularly with the LEAP, CFM56, and CF34 engine programs. However, Epstein notes that the costs associated with business transformation and the company’s current position in the aftermarket are likely to limit margin improvements and cash flow in the near term.
Despite strong demand in the business aviation sector and positive developments in military and commercial markets, Epstein highlights that the LEAP program, while promising, presents a short-term challenge to commercial aero margins. The company is expected to overcome these challenges through strategic contract negotiations and facility expansions, such as those in Augusta and Dallas Fort-Worth. Nevertheless, given these mixed factors, Epstein maintains a Hold rating, reflecting a cautious outlook until these initiatives translate into more significant financial gains.
Epstein covers the Industrials sector, focusing on stocks such as General Dynamics, Boeing, and Embraer. According to TipRanks, Epstein has an average return of 20.0% and a 65.92% success rate on recommended stocks.
In another report released on November 12, Morgan Stanley also reiterated a Hold rating on the stock with a $32.00 price target.