Key Takeaways:
- Safran SA is capitalizing on robust demand for aircraft engines, services, and defense systems as global air traffic surpasses pre‑pandemic levels and airlines modernize fleets for fuel efficiency and lower emissions.
- SAF stock could reasonably reach €405 per share by December 2027, based on our valuation assumptions.
- This implies a total return of 25.8% from today’s price of €322, with an annualized return of 12.3% over the next 2.0 years.
Safran SA (SAF) is strengthening its position as a leading aerospace and defense supplier by ramping LEAP engine production, expanding high‑margin aftermarket services, and leveraging its technology portfolio across propulsion, equipment, and defense markets. The company benefits from long‑duration OEM shipsets that drive decades of recurring maintenance revenue, while rising global passenger traffic supports continued growth in engines, services, and aircraft equipment.
The French aerospace group has delivered a strong share price performance, with SAF stock rising from €211 one year ago to €322 recently as profitability and cash generation improve. Safran’s combination of secular growth in air travel, content per aircraft, and resilient defense exposure positions the company to compound earnings over the long term.
Here’s why Safran SA stock could provide attractive returns through 2029 as it scales LEAP engine output, monetizes its installed base through aftermarket services, and maintains disciplined margin expansion.
What the Model Says for Safran Stock
We analyzed the upside potential for Safran SA stock using valuation assumptions based on its large installed base of aircraft engines, growing aftermarket services, and continued recovery and expansion in global air traffic.
Based on estimates of 12.2% annual revenue growth, 17.2% operating margins, and a normalized P/E multiple of 28x, the model projects Safran SA stock could rise from €322 to €501 per share.
That would be a 55.4% total return, or a 11.7% annualized return over the next 4.0 years.
Our Valuation Assumptions
TIKR’s Valuation Model lets you plug in your own assumptions for a company’s revenue growth, operating margins, and P/E multiple, and calculates the stock’s expected returns.
Here’s what we used for SAF stock:
1. Revenue Growth: 12.2%
Safran SA’s revenue has rebounded strongly, with revenue growth (CAGR) of 17.8% over the last year, 2.1% over the past five years, and 5.9% over the past ten years as the company recovered from the pandemic and continued to scale its aerospace and defense operations.
The company is benefiting from robust demand for its CFM56 and LEAP engines and associated services, as higher aircraft utilization and continued fleet modernization drive more shop visits and aftermarket activity.
Based on analysts’ consensus estimates, we used a 12.2% forecast, reflecting Safran’s opportunity to grow in line with healthy OEM deliveries and a larger installed base while normalizing from the exceptional post‑pandemic rebound.
2. Operating Margins: 17.2%
Safran has delivered solid profitability, with operating margins of 13.6% over the last year and a five‑year average of 15.5%, supported by scale, operational efficiencies, and a growing mix of high‑margin services.
The company’s focus on aftermarket revenue, cost discipline, and productivity improvements across its engine, equipment, and defense segments provides a path for margin expansion as volumes increase.
Based on analysts’ consensus estimates, we forecast 17.2% operating margins, reflecting Safran’s ability to benefit from higher aftermarket contribution and improving productivity as LEAP production matures, while still investing in next‑generation propulsion and systems.
3. Exit P/E Multiple: 28x
Safran stock currently trades at a P/E multiple of 28x, which is a little below its five‑year average of 28.6x but above ten‑year average of 24.6x, as investors price in a strong multi‑year growth and cash‑generation profile.
The premium valuation is supported by Safran’s entrenched position in narrow‑body engines, long‑term service contracts, and diversified exposure across civil aerospace and defense.
Based on analysts’ consensus estimates, we apply a 28x exit multiple, slightly below the current valuation, to account for potential normalization in investor expectations while still recognizing Safran’s structural advantages and long‑term growth prospects.
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What happens if things go better or worse?
Different scenarios for SAF stock through 2030 show varied outcomes based on air‑traffic growth, engine and services demand, and execution on margin expansion (these are estimates, not guaranteed returns):
- Low Case: Slower traffic growth or weaker aftermarket volumes → 5.1% annual returns
- Mid Case: Solid engine deliveries and resilient services growth → 11.7% annual returns
- High Case: Stronger‑than‑expected demand and sustained premium margins → 17.7% annual returns
Even in the conservative case, Safran SA stock offers positive returns supported by its entrenched positions in aircraft engines and equipment, long‑term service contracts, and exposure to both commercial and defense end‑markets. The company’s ability to generate attractive IRRs across scenarios underscores the value of its installed base and durable aerospace demand drivers.
SAF Stock Valuation Model (TIKR)
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How Much Upside Does Safran SA Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
