Aerospace Stocks Plunge as Melius Warns of Slowing Growth

Aerospace stocks took a hit on Monday as Melius Research downgraded five companies to 'Hold' from 'Buy', warning that several years of strong aftermarket growth may be coming to an end.

The firm expects aftermarket growth to slow to the high-single-digit percentage range next year, below the low-teens growth some investors have been modeling. This moderation is attributed to aging aircraft fleets and delays in new deliveries.

Melius cut its price targets for all five companies, with GE Aerospace seeing the largest reduction, down to $350 from $432.

Honeywell Aerospace Technologies' target was reduced to $190 from $216, while TransDigm Group's target was lowered to $1,331 from $1,477. Woodward shares were cut to $388 from $458.