GE Aerospace (NYSE:GE)

The observed financial metrics demonstrate notable variations throughout the periods analyzed, reflecting shifts in profitability and capital structure.

Return on Assets (ROA)

The ROA exhibited a generally negative trend initially, dipping to -3.28% by the end of 2021. This indicates challenges in asset efficiency during this timeframe. Subsequently, a marked improvement is evident from early 2022, transitioning from slightly positive to steadily increasing positive values, peaking around 6.29% by the third quarter of 2025. This uplift signals enhanced effectiveness in generating profit from assets over time.

Financial Leverage

Financial leverage started at a higher ratio of 7.3 in the first quarter of 2021, showing a decreasing trend through the end of 2021 down to 4.93. This reduction suggests decreased reliance on debt financing during this period. From early 2022 onwards, leverage ratios rose again, displaying some fluctuations but generally stabilizing in the range between 5.16 and 6.82, indicating a moderate and steady use of leverage thereafter.

Return on Equity (ROE)

ROE reflected significant volatility initially, with deep negative values reaching -16.17% by the end of 2021, implying decreased shareholder returns and challenges in equity profitability. Starting from early 2022, ROE experienced a sharp recovery, moving into positive territory and demonstrating strong growth, peaking above 42% by the third quarter of 2025. This upward momentum illustrates improved capability in generating returns for equity holders, correlating with the improving ROA and controlled financial leverage during the latter periods.

Overall, the data depicts an initial period of financial strain with considerable losses and high leverage, followed by a pronounced recovery in profitability metrics, complemented by a more balanced use of financial leverage. This progression suggests effective operational and financial management adjustments resulting in enhanced financial performance over time.

The analysis of the quarterly financial data reveals several notable trends over the observed periods. The company experienced significant fluctuations in profitability, efficiency, and leverage ratios, which provide insight into operational and financial performance dynamics.

Net Profit Margin

The net profit margin exhibited considerable volatility initially, with negative values from the first quarter of 2021 through much of 2022, indicating periods of losses or minimal profitability. Starting in late 2022, the margin turned positive and showed a strong upward trajectory through 2023 and into 2025, peaking near 20%. This shift suggests an improvement in cost control, pricing strategy, or revenue growth enabling sustained profitability.

Asset Turnover

The asset turnover ratio maintained relative stability across most periods, fluctuating modestly between 0.29 and 0.43. The ratio peaked in early 2023 at 0.43 but then demonstrated a gradual decline towards the end of 2024 and early 2025, settling around 0.3. This pattern indicates that asset utilization efficiency was largely consistent but showed signs of slight weakening in the later periods, which may reflect either increased asset base outpacing sales or decreased sales volume relative to assets.

Financial Leverage

Financial leverage decreased markedly from above 7 in early 2021 down to below 5 by the end of 2021, signaling a reduction in reliance on debt or increased equity financing. However, starting in 2022, leverage showed a rising trend again, with a gradual climb reaching nearly 7 by late 2025. The increasing leverage ratio in recent years suggests growing use of debt financing or a reduction in equity, which bears implications for financial risk and cost of capital.

Return on Equity (ROE)

ROE mirrored the volatility seen in net profit margin, starting with strongly negative returns through much of 2021 and the first part of 2022. From late 2022 onward, ROE surged impressively, reaching above 40% by mid-2025. This strong recovery and growth reflect improved profitability combined with effective use of leverage and assets, indicating enhanced value creation for shareholders during the later periods.

Overall, the data indicate a challenging financial environment through early 2022 with losses and elevated leverage, transitioning towards robust profitability and strengthened returns in subsequent years. While asset efficiency remained somewhat stable but weakened slightly, the improved net margins and ROE supported by increased leverage point to a strategic shift likely aimed at growth and enhanced financial performance.

The analysis of the quarterly financial data reveals several key trends in profitability, operational efficiency, financial structure, and overall returns over the periods considered.

Profitability Margins

The EBIT margin shows significant volatility in the early periods, with negative values reaching as low as -6.94% in December 2021. However, from March 2023 onward, there is a marked improvement, with margins consistently positive and increasing up to approximately 25% by late 2025. This indicates a substantial enhancement in operating profitability over time.

Tax Burden

The tax burden ratio is available starting from March 2023 and fluctuates between 0.32 and 0.95. Initially low at 0.32, it quickly rises to around 0.9 and stabilizes near 0.85 to 0.87 in the subsequent periods. This suggests a normalization of tax expenses relative to pre-tax profits across recent periods.

Interest Burden

The interest burden shows an erratic pattern early on, with a negative value recorded in September 2021 indicating potential challenges related to interest expenses or income. From March 2023, this ratio improves substantially, reaching values close to 0.9 by the end of 2025, demonstrating reduced impact of interest expenses on earnings before tax.

Asset Turnover

Asset turnover remains relatively stable across all periods, fluctuating narrowly between 0.29 and 0.43. This stability suggests consistent efficiency in utilizing assets to generate revenue without significant improvement or deterioration.

Financial Leverage

The financial leverage ratio shows a general declining trend from 7.3 in early 2021 to around 4.9 by late 2021. Subsequently, it fluctuates between approximately 5.2 and 6.8 from 2023 through 2025. This indicates a moderate increase in leverage in the later periods, implying greater use of debt financing relative to equity.

Return on Equity (ROE)

ROE exhibits a pattern consistent with profitability trends. Early periods reflect negative returns, with a low of -16.17% in December 2021, indicating losses to shareholders. Post-March 2023, ROE experiences a strong rebound, escalating to over 40% by late 2025. This robust growth reflects improved net earnings in relation to shareholders' equity and suggests enhanced value creation.

In summary, the data indicate a period of operational challenge and losses up to early 2022, followed by significant recovery and growth in profitability, interest management, and return on equity from 2023 onwards. Asset efficiency remains steady, while financial leverage increases moderately in the more recent periods. The trends point to strengthening financial health and improved capacity to generate shareholder value over time.

Net Profit Margin

The net profit margin exhibited significant fluctuations throughout the observed period. Initially, the margin was negative, starting at -4.68% and continuing to decline to a low of -9.17% at the end of 2021, indicating operational challenges and negative profitability. From early 2022, the margin showed improvement, turning positive by December 2022 at 0.31% and then increasing substantially over the subsequent quarters. By March 2023, the margin had risen sharply to 12.35% and continued an upward trajectory, reaching a peak of 20.43% in June 2025. Although there was a minor dip to 5.96% in March 2024, the overall trend reflects a strong recovery and progressively enhanced profitability in recent years.

Asset Turnover

Asset turnover indicated moderate variability with a generally stable range. Starting around 0.29-0.3 in early 2021, it increased gradually to reach 0.4 by late 2022. However, after this peak, the turnover ratio experienced some volatility, fluctuating between 0.29 and 0.43 across subsequent quarters. Notably, after March 2024, the ratio declined to lower levels around 0.29-0.31 by late 2025. This pattern suggests varying efficiency in utilizing assets to generate sales, with periods of improvement followed by some decline in turnover efficiency towards the end of the timeline.

Return on Assets (ROA)

Return on assets mirrored the net profit margin trend, starting negative at -1.34% in early 2021 and declining to a low point of -3.28% by December 2021. The ratio then improved significantly, turning positive at 0.12% by December 2022. From this point, ROA increased consistently, reaching above 6% by late 2025. The rise in ROA indicates enhanced profitability relative to asset base, albeit with initial periods of underperformance. Temporary dips, such as around March 2024 where ROA decreased to 2.14%, were followed by recoveries. Overall, this ratio reflects a positive momentum in generating returns from assets moving forward.

Tax Burden

The tax burden ratio shows a significant increase starting from the period ending March 2023, rising sharply from 0.32 to values close to or exceeding 0.9 in subsequent quarters. This indicates a substantial improvement in the company's ability to retain earnings after taxes during the recent periods, maintaining a stable ratio around 0.85 to 0.9.

Interest Burden

Interest burden data is sporadic in earlier periods but starting from March 2023 it exhibits a consistent upward trend from 0.3 to 0.92 by September 2025. This trend reflects a growing efficiency in managing interest expenses relative to operating income, suggesting improved financial leverage management over time.

EBIT Margin

The EBIT margin has experienced notable volatility over the observed periods. Early data show negative margins, with fluctuations and a deep dip in the latter half of 2021. However, from March 2023 onward, there is a strong positive trend with margins rising significantly, reaching above 25% by the third quarter of 2025. This improvement signals enhanced operational profitability and overall business performance.

Asset Turnover

Asset turnover ratios started relatively low around 0.29 to 0.3 in the initial periods and peaked around 0.43 in early 2023, suggesting improved efficiency in asset utilization. However, there is a gradual decline afterward, stabilizing around 0.29 to 0.31 towards late 2024 and 2025. This indicates a moderate reduction in how effectively the company is leveraging its assets to generate revenue in recent periods.

Return on Assets (ROA)

ROA exhibited negative or near-zero values during the earlier periods with some recovery signs beginning around late 2021 and early 2022. Starting from March 2023, ROA shows a strong upward trajectory, increasing steadily and reaching above 6% by the third quarter of 2025. This pattern highlights a significant enhancement in asset profitability, aligning with improvements in EBIT margin and interest burden management.

The financial trends over the observed periods indicate a significant improvement in profitability and operational efficiency, accompanied by changes in tax and interest burden management.

Tax Burden

The tax burden ratio shows an increasing trend starting from a low point of 0.32, rising sharply to approximately 0.94-0.95 around the early periods of 2023. Thereafter, it stabilizes somewhat, fluctuating between 0.76 and 0.89 and generally trending slightly downward but maintaining relatively high levels near 0.85-0.87 towards the latest periods. This suggests a shift towards higher effective taxation or changes in tax policies impacting the company during these years.

Interest Burden

The interest burden displayed an initial negative value around -0.1, indicating possible negative or non-standard interest impacts early in the dataset. From 2023 onwards, the ratio consistently improves, climbing from 0.3 up to the low 0.9 range around 2024 and stabilizing thereafter close to 0.91-0.92. The steady increase and stabilization near unity imply improved interest expense management or reduced impact of interest costs on earnings.

EBIT Margin

The EBIT margin experienced considerable volatility in the early stages, with multiple negative values and a low point near -6.94%. Beginning in 2022 and continuing into 2023 and beyond, a robust upward trend is evident. Margins rose sharply to over 15%, and later periods demonstrate continued growth, peaking above 25% by 2025. This persistent improvement indicates stronger operational performance and better control over costs relative to revenues.

Net Profit Margin

Net profit margin parallels the EBIT margin trend, starting with negative values and reaching a nadir near -9.17% early on. From 2023, net margins increase significantly to the range of 12-15%, reflecting turnaround in profitability. Subsequent periods see continued margin expansion, peaking near 20% by 2025, although some fluctuation is evident around 2024. Overall, this improvement confirms enhanced bottom-line profitability consistent with better operational results and possibly more effective interest and tax burden management.

In summary, the data reveals a company that struggled with profitability and financial burdens in earlier periods but has shown marked improvement in both operational margins and management of tax and interest expenses in recent years. The positive trends in EBIT and net profit margins coupled with more stable and higher interest burden ratios suggest strengthened financial health and efficiency going into the forecast years.