What moat does Safran SA have?

The advantage is the engine already on the wing and the part that fits only that engine. The airline can choose another engine on the next aircraft, where there is an alternative. The moat narrows if the fleet flies less, or if the shop visit is deferred.

How do you read the Safran SA radar?

Health is debt against an engine and parts business, not against the airline. Quality separates the margin on the new engine, which is usually thin, from the margin in the shop. Growth follows aircraft deliveries and flight hours. P/E is read against a year of many deliveries, not against that peak. Shareholder return is the dividend, checked against cash. Do not call it an exclusive on the single aisle.

Which multiples matter for Safran SA?

The P/E of a year of many deliveries is not normal earnings. EV/EBITDA is read with the parts inside, not only the new engine. Do not use Airbus's multiple, which sells the aircraft, or GE's as if CFM were all of GE. A dash if SAF.PA is missing.

What does this Safran SA analysis leave out?

Not advice on Safran. Vaultflake does not split the new engine and the shop and does not treat the LEAP as the whole fleet. This is not a duopoly. Read the filings. A past dividend is not a right. The table is a snapshot, not a target price.

Safran SA (SAF.PA) analysis

Safran SA

Sector:Industrials · Aircraft Engines

Country:France

Profile and moat

Safran builds aircraft engines and the parts that are changed when the engine goes through the shop. On the single aisle it does this through CFM, the partnership with GE Aerospace. The LEAP flies on the Boeing 737 MAX. On the Airbus A320neo family it competes with Pratt & Whitney's engine. This is not a closed duopoly and not decades of cash by decree.

Parts revenue comes when the engine flies and when the shop visit is due. That visit can slip, and a durability problem brings the cost forward. A year of many aircraft deliveries is not normal earnings. Rolls-Royce weighs more on the widebody. This report does not state a share of the fleet.

The dividend comes from that cash, after the shop. It has to fit.

Sustainable Competitive Advantage

Safran SA (SAF.PA) analysis

Safran SA

Sector:Industrials · Aircraft Engines

Country:France

Profile and moat

The dividend comes from that cash, after the shop. It has to fit.

Sustainable Competitive Advantage

Safran SA (SAF.PA) analysis

Profile and moat

Safran SA (SAF.PA) analysis

Profile and moat

Radar axes

Limits of this report

Questions from this report

What moat does Safran SA have?

How do you read the Safran SA radar?

Which multiples matter for Safran SA?

What does this Safran SA analysis leave out?

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