General Electric (NYSE: GE) has had a great year, with the stock price up 96% over the past 52 weeks. That run looks likely to continue with the spinoff of GE Vernova, set for April 2. That’s the view of Wells Fargo analyst Matthew Akers, who recently upgraded GE’s price target from $177 to $200. Akers maintained an “overweight” rating on the stock.

General Electric has a path to higher margins

In Akers’s view, GE has the potential to cut costs significantly in the coming years thanks to the spinoff, which should result in higher margins down the line. As a smaller company, there’s an obvious opportunity to cut down on corporate costs, and its GE Aerospace segment is set to move into a cash-flow generative space as revenue from servicing LEAP engines starts to kick in.

In addition, Akers believes GE Vernova is worth around $34 per GE share, a relatively high estimate compared to other Wall Street analysts.

How GE Vernova is trading now

The excellent news is that Akers’s GE Vernova estimate is close to the mark. Whole GE Vernova hasn’t begun “regular way” trading yet, but it began trading on a “when issued” basis under the ticker “GEV WI” on March 27.

At the time of writing, it’s trading at $133, and since GE stockholders will get one GE Vernova share for every four shares they hold in GE, the price equates to $33.25 per GE share, close to Akers’s target.

On the other hand, the GE stock that is trading without the right to receive GE Vernova stock (under the ticker “GE WI”) is trading at about $145 at the time of writing. As such, GE Aerospace (what the remaining company will be called) isn’t quite at the level Akers envisages. However, if he’s right about the margin expansion opportunity, it will probably get there in time.

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Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.