Safran Stock Soars 18% as H1 2025 Revenue Grows 13.2%
Safran, a leading global aerospace and defense company, has reported impressive growth and increased its targets for 2025. The company's stock has rallied 18% since the last report, outperforming the S&P 500's 13% gain, and is considered undervalued with a potential 30% upside at a $456 price target.
Safran's revenues grew 13.2% to €14.77 billion in H1 2025, driven by 13.2% organic growth and a €111 million positive impact from scope changes, despite currency headwinds. Notably, propulsion revenues grew 16.7% and 16.9% organically to €7.54 billion, with services sales growing 21.3% and OEM sales growing 9.7%. Additionally, equipment and defense sales grew 8% organically, with OEM sales growing 5.5% and services sales growing 12%.
In recent months, Safran has demonstrated strong confidence in its financial strength by conducting significant share buyback programs. A new tranche of up to 500 million euros started on September 22, 2025, as part of a comprehensive 5 billion euros buyback plan running until 2028. Key shareholders include the French government, TCI Fund Management Ltd., and BlackRock Fund Advisors. Safran has also announced strategic future plans such as developing advanced quantum sensors for the U.S. military and securing long-term maintenance contracts with Singapore Airlines, indicating a focus on innovation and stable aftermarket revenue.
Safran's EBITDA grew 25% to €3.16 billion, reflecting margin expansion from 19.3% to 21.4%. The company's operating income increased 27.2% to €2.51 billion, including 26.5% organic growth and a €19 million addition from scope changes, bringing margins from 15.1% to 17%. Safran has also raised its targets for 2025, expecting revenues to grow in the low teens, recurring operating income to reach €5-€5.1 billion, and free cash flow to be €3.4-€3.6 billion. Free cash flow improved from €1.46 billion to €1.83 billion.
Safran's strong performance and growth prospects are reflected in its increased targets for 2025 and the rally in its stock price. The company's focus on innovation, strategic partnerships, and shareholder value creation positions it well for continued success in the aerospace and defense industry.
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