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Investing.com - Shares in Safran (EPA:SAF) traded lower on Tuesday after analysts at Citi downgraded their rating of the French jet engine maker to "neutral" from "buy."

In a note to clients, the brokerage said Safran’s "current share price broadly reflects the company’s continued profitable growth." The stock’s price-to-earnings ratio, which stood at 36.4 last year and is expected to hover around 32.6 in 2025, is "towards the upper end of peer multiples/yields," but is not "stand-out expensive," Citi argued.

"We believe Safran’s market position and cash conversion justify a premium valuation. We also believe this premium is broadly reflected in the current share price," the strategists led by Charles Armitage wrote.

By 05:04 ET (09:04 GMT), the stock had dipped by 1.1% to 263 euros in Paris trading. So far this year, Safran has jumped by more than 22%.

The Citi analysts noted that their near-term sales and operating profit forecasts for Safran are roughly 3%-5% above consensus estimates, although their projection for income in 2030 is slightly below market expectations. Its free cash flow forecasts "straddle consensus depending on the year," they added.

In April, Safran delivered stronger-than-anticipated first-quarter sales and said it was looking into ways to manage the effect of increased uncertainty around global trade relations. The firm suggested that it was exploring possibly passing on a special trade-related surcharge to customers such as airlines who purchase spares or repair services.

CEO Olivier Andries told reporters that it was also in talks with its suppliers to mitigate the impact of the tariffs on its own expenses. But media reports said Safran and other groups have already agreed to take on some of the cost of the levies incurred by suppliers.

The maker of everything from plane landing gears to cabin interiors posted a 16.7% surge in revenues to 7.257 billion euros during the first quarter. It backed its full-year forecasts as well, noting that its targets omitted any possible future impact from U.S. President Donald Trump’s sweeping tariff agenda.

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