Summary MTU Aero Engines AG remains a Strong Buy, with a base case price target of $544.25 and significant undervaluation versus aerospace peers. Despite recent underperformance, MTUAF's improved EBITDA and free cash flow CAGRs, plus a net cash position, highlight robust fundamentals and upside potential. MTUAF's diversified commercial and military engine portfolio underpins growth, with OEM sales driving high-margin aftermarket opportunities. Market fixation on a 32.7x P/E ratio overlooks MTUAF's superior cash conversion, capital efficiency, and relative value compared to peers trading at 43x P/E. Looking for a helping hand in the market? Members of The Aerospace Forum get exclusive ideas and guidance to navigate any climate. Learn More » MTU Aero Engines AG (MTUAY) (MTUAF) received a Strong Buy rating in my last report. However, the aerospace and defense stock remained flat, underperforming the S&P 500’s (SP500 More on my IG service If you want full access to all our reports, data and investing ideas, join The Aerospace Forum, the #1 aerospace, defense and airline investment research service on Seeking Alpha, with access to evoX Data Analytics, our in-house developed data analytics platform. This article was written by Dhierin-Perkash Bechai is an aerospace, defense and airline analyst. Dhierin runs the investing group The Aerospace Forum, whose goal is to discover investment opportunities in the aerospace, defense and airline industry. With a background in aerospace engineering, he provides analysis of a complex industry with significant growth prospects, and offers context to developments as they occur, describing how they might affect investment theses. His investing ideas are driven by data informed analysis. The investing group also provides direct access to data analytics monitors. Learn more. Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Summary MTU Aero Engines AG remains a Strong Buy, with a base case price target of $544.25 and significant undervaluation versus aerospace peers. Despite recent underperformance, MTUAF's improved EBITDA and free cash flow CAGRs, plus a net cash position, highlight robust fundamentals and upside potential. MTUAF's diversified commercial and military engine portfolio underpins growth, with OEM sales driving high-margin aftermarket opportunities. Market fixation on a 32.7x P/E ratio overlooks MTUAF's superior cash conversion, capital efficiency, and relative value compared to peers trading at 43x P/E. Looking for a helping hand in the market? Members of The Aerospace Forum get exclusive ideas and guidance to navigate any climate. Learn More » MTU Aero Engines AG (MTUAY) (MTUAF) received a Strong Buy rating in my last report. However, the aerospace and defense stock remained flat, underperforming the S&P 500’s (SP500 More on my IG service If you want full access to all our reports, data and investing ideas, join The Aerospace Forum, the #1 aerospace, defense and airline investment research service on Seeking Alpha, with access to evoX Data Analytics, our in-house developed data analytics platform. This article was written by Dhierin-Perkash Bechai is an aerospace, defense and airline analyst. Dhierin runs the investing group The Aerospace Forum, whose goal is to discover investment opportunities in the aerospace, defense and airline industry. With a background in aerospace engineering, he provides analysis of a complex industry with significant growth prospects, and offers context to developments as they occur, describing how they might affect investment theses. His investing ideas are driven by data informed analysis. The investing group also provides direct access to data analytics monitors. Learn more. Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

MTU Aero Engines is rated a "Strong Buy" with 19% upside, robust sales growth, and undervalued stock. Learn more about the company.

MLS specialises in the leasing and asset management of commercial aero engines and is a subsidiary of MTU Aero Engines.

MTU Aero Engines reports 21% revenue growth in H1 2025, driven by GTF engine MRO demand and signs of supply chain recovery.

EME Aero, the joint venture between Lufthansa Technik and MTU Aero Engines, has opened its second test cell at its engine maintenance facility

The new joint venture will develop a heavy European helicopter engine for the ENGRT project and future military helicopters.