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Earnings Previews: General Electric Co. (NYSE: GE)
By: 24/7 Wall St. | April 22, 2022
• Here is a look at what to expect from four more companies also reporting results Tuesday morning.
General Electric
Over the past 12 months, shares of General Electric Co. (NYSE: GE) have slipped by nearly 12%. They dipped to their 52-week low in early March. Last November, the company said it would spin off its health care and energy businesses into separate companies and become primarily an aviation company.
The health care spinoff is expected early next year and the energy spinoff a year later. That means that by mid-2024, what remains of GE will be worth less, probably a lot less. The payoff for investors in shares of the new companies will help salve the wounds, but there is no compelling reason to hold on to the stock in the meantime.
Analysts remain bullish on GE stock. There are 15 Buy or Strong Buy ratings on the stock, along with six Hold ratings, among the 21 brokerages covering the stock. At a recent share price of around $90.60, the potential upside to a median price target of $117.00 is about 29%. At the high target of $133.00, the upside potential is about 47%.
First-quarter revenue is forecast at $16.94 billion, which would be down 16.6% sequentially and about 1.0% lower year over year. Adjusted earnings per share (EPS) are forecast at $0.20, down 78.6% sequentially and 16.7% year over year. For the full 2022 fiscal year, analysts currently expect GE to report EPS of $3.27, up nearly 55%, on sales of $77.64 billion, or 4.6% higher.
GE stock trades at 27.7 times expected 2022 EPS, 16.7 times estimated 2023 earnings of $5.43 and 13.6 times estimated 2024 earnings of $6.66 per share. The stock’s 52-week range is $85.29 to $116.17 (split-adjusted), and GE pays an annual dividend of $0.32 (yield of 0.35%). Total shareholder return for the past 12 months was negative 14.5%.
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On this day in 1892 General Electric $GE was founded
By: Ticker History | April 15, 2022
• On this day in 1892 General Electric $GE was founded
It was created through the merger of Thomas Edison's Edison General Electric and Thomson-Houston Electrical Company.
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General Electric (GE) Given New $115.00 Price Target at Barclays
By: MarketBeat | March 29, 2022
• General Electric (NYSE:GE - Get Rating) had its target price lowered by Barclays from $116.00 to $115.00 in a report released on Tuesday, The Fly reports. Barclays's price objective would indicate a potential upside of 25.00% from the company's current price...
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God Bless my grandparents who somehow have managed to turn "Buy and Hold" from the 1950's with GE and a few other stocks, all with several stock splits along the way into a seven-figure net worth.
I guess that's one way to do it!!
My grandparents have owned shares in GE for decades.
$GE: Another stock that seems poised to roll over, making lower highs and lower lows
By: Markets & Mayhem | March 24, 2022
• $GE: Another stock that seems poised to roll over, making lower highs and lower lows.
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GE cuts CEO Culp's incentive grant after shareholder rebuke
By: Reuters | March 17, 2022
CHICAGO (Reuters) - General Electric (NYSE:GE) Co on Thursday said its Chief Executive Larry Culp would take a 67% cut to an incentive grant this year after shareholders last year rejected his compensation package in a non-binding but rare rebuke over executive pay.
In its annual proxy statement filed on Thursday, the Boston-based industrial conglomerate said Culp's annual equity incentive grant for 2022 will be reduced to $5 million from $15 million.
The company also disclosed Culp's annual compensation last year was about $22.7 million, down 69% from 2020, due to a reduction in stock awards.
Proxy votes against executive pay at S&P 500 companies became more common last year and were often sparked by "questionable practices and metrics," such as easier performance targets during the COVID-19 pandemic, according to a report by shareholder advocacy group As You Sow.
Among the S&P 500, a record 16 companies had the pay of their CEOs and other top leaders rejected by more than half of investors last year, up from 10 in 2020 and seven in 2019, the report said.
As part of an extension of Culp's employment contract to 2024, GE in 2020 canceled old shares he had been given and granted him new shares tied to lower financial targets. The compensation package entailed a payout through 2024 of as much as $230 million.
Some 57.7% of GE shareholders last year rejected the pay deal, according to preliminary results, which some proxy advisory firms argued was too generous.
GE said in the proxy statement its board had gathered feedback from shareholders on the issue and tried to address concerns related to compensation matters.
While defending the 2020 grant, the company said its board does not intend to enter into a similar modification of the CEO's employment agreement in the future.
It also promised to use discretion sparingly in determining bonus pools.
GE's annual shareholders meeting is scheduled in May.
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General Electric Shows Why Stock Buybacks Aren’t Always as Good as Dividends
By: Barron's | March 14, 2022
News that General Electric might begin buying back stock again is more than a sign the company has repaired its balance sheet. It is also a reminder that dividends and stock buybacks are two different things.
The two are similar in that they both return a company’s cash flow to shareholders. But with dividends, cash goes into investors’ pockets, while buybacks reduce a company’s share count, ideally increasing the value of each share.
Buybacks have their advantages. They are supposed to be more “capital efficient” than dividends because they are taxed when investors receive them, while taxes on capital gains—the potential result of buybacks—are paid when a stock is sold. Other tax considerations also slightly favor buybacks, according to accounting expert Robert Willens.
But a bird-in-the-hand argument favors dividends. GE’s (ticker: GE) example shows why.
The conglomerate said on Tuesday that its board authorized spending $3 billion on buybacks. That gives the company the ability to repurchases shares if management chooses.
GE has been out of the buyback game for a while, for good reason. A legacy of poorly timed acquisitions and stock buybacks left the company with too much debt, so it had to use the cash it generated to pay that down instead of sending it back to shareholders.
GE used to be a big buyer of its own stock. Between 2012 and 2017, the company spent roughly $32 billion to repurchase its shares, net of any cash coming in from stock issuance. GE’s share count dropped by roughly 235 million shares over that span.
GE was purchasing a lot of stock back when shares were north of $230. Calculations aren’t perfect, or easy, but GE’s average purchase price was likely well above $200 a share. GE shares are at about $93 today, so the company clearly overpaid for its own stock.
The company had no comment on the past repurchases. No GE figures on its average purchase price were immediately available.
All that money was going out the door, or into the stock, even though the company had an enormous burden of debt. Coming up with an exact number is difficult because much of it was linked to GE Capital, the industrial businesses’ vast finance arm, which borrowed money to lend to customers to buy its turbines, engines, and other products, among other operations.
Starting around 2018, new management at GE decided to tackle that debt load. Over the past three years, the company has paid back more than $85 billion in debt, selling assets to fund the process. In theory, GE might still have its Biopharma business or its aircraft-leasing business, both sold recently, if it still had the billion it spent on share repurchases.
Now, GE’s balance sheet is in much better shape. That’s why management can think about buying stock.
Today, GE has roughly $25 billion in net debt, which is essentially total debt less cash. It is expected to produced earnings before interest, taxes, depreciation, and amortization, of about $10 billion by 2023, so net debt is 2.5 times Ebitda. Industrial companies in the S&P 500 operate with an average ratio of about 2 times today.
GE’s dividend, meanwhile, has withered as management sought to preserve cash and pay down debt. The company once paid out $1.92 a share per quarter, adjusting for its recent reverse stock split. Now it pays out 8 cents a share.
In the end, buybacks ended up costing GE shareholders more than they cost the company. That isn’t the way it’s supposed to work out.
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GE Builds 350-Ton Turbines at Its Power Facilities. Here’s What We Found on a Tour.
By: Barron's | March 12, 2022
General Electric led a tour of one of its South Carolina gas power facilities as part of its Investor Day on Thursday—and while the machines produced there, and the process to make them, are incredible, sometimes great technology isn’t enough.
The story of GE’s (ticker: GE) gas power division shows why the company is redoubling its efforts in lean manufacturing. GE CEO Larry Culp, who joined the company in 2018, is a lean devotee and has taken its application at the U.S. industrial giant to the next level.
Being lean has its roots in post-World War II Japan, and the concept broadly focuses on inclusive, decentralized, and hands-on management. It also incorporates statistical process control so companies can constantly improve operations and tackle problems.
Back to the machines. While taking part in the tour for analysts, investors and reporters at the plant outside Greenville, Barron’s saw a 7HA.03 natural gas-fired turbine that’s used to generate up to 430 megawatts of electricity. That works out to roughly 585,000 horsepower—the same amount of power generated by 1,200 semi trucks.
The turbine, one of the featured items produced at the site, is a behemoth, weighing in at around 350 tons. Bolts fastening parts of the shell—which contains compressor and turbine blades—are as thick as a man’s arm. The finished product looks like some kind of mashup between a giant mechanical squid and a torpedo submarine that could dwarf several elephants.
The compressor portion of the turbine, meanwhile, has more than a dozen rotors pressurizing air to more than about 20 times atmospheric pressure—the pressure someone would feel about 650 feet under the sea. The turbine’s combustor, which injects fuel, has 400 tubes. The four-stage turbine on the back end of the machine, which turns a generator, has hundreds of fan blades. There are roughly 3,000 parts in the turbine overall, and it can take up to a year to build one. It’s quite a machine.
So is the plant that produces it: The facility is equivalent in size to about 21 football fields. A seemingly endless array of white cubes are actually computer-controlled milling machines that produce rotor and fan blades, among other things. Gantry cranes and partially assembled turbines can also be found in the factory. Parts of steel cases on site include holes waiting to encase all the turbine and rotor blades.
Outside the back of the factory, Barron’s spotted a shrink-wrapped, finished turbine that was waiting to travel via rail to Charleston before being shipped to Asia. Beyond were warehouse-size buildings for testing turbines; it can take up to four weeks to install one turbine in a building for testing.
While all of this might not mean much for investors, it does show the difficulty of turbine production. GE’s gas power division isn’t likely to be disrupted by a start-up. But GE isn’t the only game in town: Siemens Energy (ENR.Germany) and Mitsubishi Heavy Industries (7011.Japan) also make power turbines.
Stable market structure isn’t enough to produce stellar stock returns, though. GE shares have lost investors about 16% a year on average over the past five years, while Mitsubishi shares have lost about 2% annually in that period. Siemens Energy doesn’t have five-year returns, but Siemens (SIE.Germany), which spun out Siemens Energy and owns 40% of that business, does. Siemens’ shares have managed an average annual return of about 5% since 2017. (Compare these stats to the S&P 500, which in the past five years has earned investors about 14% a year on average.)
Weak power markets haven’t helped. Combined 2021 power sales at GE, Mitsubishi, and Siemens Energy came in about 8% below 2018 levels. And their combined operating profit margins have ranged from negative 0.5% to positive 4% over that span.
Volatile power markets and challenged profitability are one reason GE is leaning into lean manufacturing. On the tour, GE plant employees reflected on how lean processes are helping to cut weeks from total production, reduce defects, and lessen process inventory work. They’ve also helped turbine service staff double their productivity.
Looking ahead, GE believes it can grow its power business sales at a low-single-digit percentage and generate operating profit around 8% to 10%. Operating profit should be about $1.1 billion and $1.5 billion in 2022 and 2023, respectively. Both numbers are a slightly better than recent Wall Street expectations.
That’s better than recent history, and investors might be giving the company some credit for power improvement. GE stock is down about 2% so far this year, while the S&P 500 and the Dow Jones Industrial Average have slipped roughly 12% and 9%, respectively.
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General Electric (GE) PT Raised to $118.00
By: MarketBeat | March 11, 2022
• General Electric (NYSE:GE - Get Rating) had its price target hoisted by Royal Bank of Canada from $113.00 to $118.00 in a research note issued on Friday, Benzinga reports. The firm currently has an "outperform" rating on the conglomerate's stock. Royal Bank of Canada's price objective indicates a potential upside of 29.20% from the company's current price...
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GE sees risks from war in Ukraine, but retains 2022 earnings forecast
By: Reuters | March 10, 2022
• GREENVILLE, S.C. (Reuters) – General Electric Co on Thursday reiterated its 2022 earnings forecast despite inflationary and supply-chain challenges.
GREENVILLE, S.C. (Reuters) – General Electric Co on Thursday reiterated its 2022 earnings forecast, but said Russia’s invasion of Ukraine has added to business uncertainty.
The Boston-based industrial conglomerate last month warned that its profits would suffer in the first half of this year due to persistent supply-chain and inflationary pressures.
A run-up in global commodity prices following Russia’s invasion of Ukraine has worsened the situation.
At the company’s first in-person investor meeting in more than two years, Chief Executive Larry Culp said the company’s outlook has not incorporated the potential fallout of the situation in Ukraine as there are “too many uncertainties.”
“Like every company directly or indirectly exposed to what’s happening, there’s more uncertainty today with respect to what lies ahead than we saw just a month ago,” Culp said.
“There are really things we don’t know.”
Culp said GE would be “hyper-focused” on controlling the things it can control.
On Tuesday, the company said it has suspended its operations in the country and is working with authorities to ensure compliance with sanctions.
Culp said Russia accounts for less than 2% of the company’s overall sales. Its power business, however, has a bigger exposure to the country.
Russia’s invasion has also put the supplies of titanium from the country in doubt. The metal is used in the aerospace industry to make landing gear, blades and turbine discs.
GE said its aviation unit uses Russian supplies for just two parts for which it has more than a year of inventory on the shelf. Overall, it sources just 1% of its titanium supplies from Russia.
Mounting concerns about supply-chain and inflation have hurt GE’s shares, which are down 11% since mid-January. Its shares were down 1.2% at $90.12 in mid-day trade.
The company has said it is raising prices and trying to keep a lid on costs. It is also trying to source alternative parts to help to deal with shortages.
GE, which last November said it would split into three public companies, reaffirmed the timeline for the spin-offs.
It plans to spin off its healthcare business into a separate publicly traded company next year. It would combine its power and renewable energy units, and spin off that operation in 2024. Following the split, it will become an aviation company.
GE expects to post high-single-digit revenue growth this year on the back of a more than 20% increase in aviation revenue.
Adjusted profit for the year is projected to be in the range of $2.80 per share to $3.50 per share. It also expects to grow its profit margin by 150 basis points and to generate $5.5 billion to $6.5 billion in free cash flow.
The company expects to generate about $10 billion in adjusted operating profit and more than $7 billion in free cash flow in 2023.
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General Electric Shares Dip After Group Reaffirms Earnings Outlook
By: Vivek Kumar | March 10, 2022
• General Electric reaffirmed its profit predictions for this year despite rising input costs and supply chain bottlenecks.
General Electric shares fell over 1.4% in pre-market trading on Thursday after the company reiterated its already-lowered earnings forecast for this year at its Investors Day as surging inputs costs and supply chain bottlenecks continue to bite.
The Boston Massachusetts-based company forecasts adjusted profit for the year in the range of $2.80-$3.50 per share. The company expects its profit margin will grow by 150 basis points that will generate $5.5 billion-$6.5 billion in free cash flow. General Electric also predicted an operating profit of nearly $10 billion and a free cash flow of around $7 billion for next year.
In the fourth-quarter results, which was released in late January, the company reported quarterly adjusted earnings of $0.92 ? per share, beating the Wall Street consensus estimates of $0.83 per share. However, its revenue declined more than 7% to $20.3 billion from a year earlier. That missed analysts’ expectations of $21.5 billion.
General Electric stock fell 1.4% to $89.95 in pre-market trading on Thursday. The stock fell more than 3% so far this year after rising over 9% in 2021.
Analyst Comments
“Tail risks have been sufficiently managed over the past 4 years as to allow the particularly attractive Aviation and Healthcare franchises to be valued independently and pursue additional strategic optionality,” noted Joshua Pokrzywinski, equity analyst at Morgan Stanley.
“Power, pension, and Long-Term Care are no longer overarching drags on leverage, profitability, and cash. The catalyst path remains uneven, however, and deleveraging to unlock more equity value will ramp in earnest in mid-2022 through year-end 2023 as cash seasonality and Aviation aftermarket ramp. We see this as a good risk/reward framework today improving further as the year progresses.”
General Electric Stock Price Forecast
Fifteen analysts who offered stock ratings for General Electric in the last three months forecast the average price in 12 months of $112.33 with a high forecast of $132.00 and a low forecast of $55.00.
The average price target represents a 23.10% change from the last price of $91.25. Of those 15 analysts, 11 rated “Buy”, four rated “Hold”, while none rated “Sell”, according to Tipranks.
Morgan Stanley gave the base target price to $120 with a high of $160 under a bull scenario and $70 under the worst-case scenario. The investment bank gave an “Overweight” rating on the company’s stock.
Several analysts have also updated their stock outlook. UBS cut the price objective to $132 from $143. Credit Suisse lowered the target price to $116 from $122. RBC raised the price target to $113 from $108. BofA Global Research lashed the price objective to $132 from $140.
However, technical analysis suggests it is good to sell as 100-day Moving Average and 100-200-day MACD Oscillator shows a selling opportunity.
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GE's investors look for update on supply-chain, inflationary pressures
By: Reuters | March 9, 2022
CHICAGO (Reuters) - When General Electric (NYSE:GE) Co's investors gather on Thursday, they will focus on a potential hit to company profits from persistent supply-chain and inflationary woes.
The Boston-based industrial conglomerate last month warned that its profits would suffer in the first half of this year from supply and labor issues.
Roughly two years into the coronavirus pandemic that has snarled supply chains across the globe and driven up costs for everything from labor to raw materials, companies of all sizes are scrambling not just to produce enough to feed current demand -- but to also restock inventory shelves.
A run-up in global commodity prices following Russia's invasion of Ukraine has only worsened the situation.
While GE continues to back its earnings estimates for this year, mounting concerns about supply chains and inflation have led to a 13% fall in its shares since mid-January.
In January, GE said it would return to revenue growth this year. It also expects to grow its profit margin by 150 basis points and to generate $5.5 billion to $6.5 billion in free cash flow.
The company has said it is raising prices and trying to keep a lid on costs. It is also trying to source alternative parts to help deal with shortages.
GE is expected to reiterate its full-year earnings outlook on Thursday. Nicholas Heymann, an analyst at William Blair, says Wall Street is now more focused on GE's ability to pursue profitable growth as debt reduction and cash flow have become less of a concern.
Similarly, the fallout of Western sanctions on Russia is also expected to be a topic of discussion.
Russia accounts for about 1% of GE's revenue. On Tuesday, the company said it has suspended its operations in the country and is working with authorities to ensure compliance with sanctions.
The shift in focus away from GE's balance sheet could be a relief for its investors after declining sales, crushing debt levels and operating challenges had put the company into a survival mode.
Since taking GE's reins in 2018, Chief Executive Larry Culp has primarily focused on reducing debt by selling assets and improving cash flows by streamlining operations and cutting overhead costs.
Those measures have led to an improvement in the company's balance sheet, allowing it to reduce debt by $87 billion. In a sign of growing confidence, the company's board has authorized a $3 billion share buyback program.
With its turnaround gathering steam, GE last November announced it would split into three public companies.
It plans to spin off its healthcare business into a separate publicly traded company next year. It would combine its power and renewable energy units, and spin off that operation in 2024. Following the split, it will become an aviation company, headed by Culp.
Some analysts, however, say the timeline for the spin-offs could be brought forward. On Thursday, they expect GE to provide an update on the breakup timing.
"We believe the market under-appreciates that the timing of the three-way breakup could happen faster," said analysts at RBC Capital Markets in a note.
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Wow. 3 BILLION DOLLAR share buyback.
That’ll help things in the long run.
General Electric (GE) Announces $3 Billion Share Buyback Program
By: Schaeffer's Investment Research | March 9, 2022
• The company is also suspending operations in Russia
• The options pits have been more bearish than usual
General Electric Co (NYSE:GE) is up 3.8% at $91.46 this morning, following news that the company's board of directors approved a $3 billion share buyback program. What's more, General Electric yesterday announced it will join a growing list of firms that are suspending operations in Russia, though it will still provide medical equipment and power generation services.
On the charts, General Electric stock recently slipped below a floor at the $88 mark, though it is now looking to close well above this area. Still, overhead pressure at the 200-day moving average remains in place, and has thwarted multiple rally attempts since November. Year-to-date, GE has lost 8.7%.
The equity is seeing more options activity than usual in response to the news. So far, 4,566 calls and 4,443 puts have crossed the tape, which is nearly double the amount that's typical at this point. The weekly 3/11 90-strike put is the most popular, with new positions being opened there.
A broader look shows a penchant for bearish bets. This is per General Electric stock's 50-day put/call volume ratio of 1.04 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 98% of readings from the past year.
Echoing this, the stock's Schaeffer's put/call open interest ratio (SOIR) of 1.16 sits higher than 89% of annual readings. In other words, short-term options traders have rarely been more put-biased.
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General Electric Has responded well playing below the daily #bbands as price forms a pennant below range
By: TrendSpider | March 6, 2022
• $GE Has responded well playing below the daily #bbands as price forms a pennant below range.
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$GE Inverse H&S fails to hold the breakout as price started the day right outside support and ended the day back below...
By: TrendSpider | March 3, 2022
• $GE Inverse H&S fails to hold the breakout as price started the day right outside support and ended the day back below...
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GE Stock Alert: Here Is General Electric’s Must-Hold Support Level
By: TheStreet | February 23, 2022
• General Electric stock continues to fight off bad news, but if it breaks down, here's key support.
It’s not surprising that General Electric (GE) stock has been under pressure over the past few days and that's before we take into account the recent stock market volatility.
In late January, GE stock suffered a large spill, trading lower on earnings. Guidance was an issue and so was the fourth-quarter revenue miss.
However, the decline gave bulls an excellent dip-buying opportunity. Shares bottomed over a three-day stretch, wicking off the $88 area each day before turning higher and rallying back over $100.
Then last week, the company reduced its outlook due to supply chain issues.
Given the action both in General Electric’s business and in the overall market, it’s a surprise that the stock is not lower.
That brings up the chart, which shows some interesting support levels to keep an eye on.
Trading GE Stock
Daily chart of General Electric stock.
Chart courtesy of TrendSpider.com
In December, GE stock bottomed at $88.17 and had a robust upside bounce. However, notice the change in character we saw at the 200-day moving average.
This moving average was support in the third and fourth quarters before failing in November. Then when General Electric was rallying in early January, this measure was resistance.
The change in character is being noted as: Selling the rips rather than buying the dips and prior support turning into current resistance.
We’re currently looking at back-to-back inside days, with an inside day meaning that the day’s range is completely contained within the prior day’s range.
If the stock breaks below the prior day’s low and can’t quickly reclaim it, that could lead to an inside-and-down day, (which is just breaking the prior day’s low following an inside day).
In any event, the larger downside rotation potential sits with last week’s low of $91.92. A break of this level and failure to reclaim it puts GE stock in a weekly-down rotation.
In that case, the must-hold support level that’s referenced in the story’s headline is at $88.
That’s where the stock bounced from in December and it’s the post-earnings support zone from January.
To break below $88 opens the door to more downside, particularly if the overall market can’t find its footing. In that scenario, it could put the 50% retracement in play down near $81.50.
On the upside, a move over $95 puts the 10-day, 21-day and 50-day moving averages in play. Look to see if these moving averages are active resistance. Above them puts downtrend resistance in play (blue line), followed by the 200-day.
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GE CEO sees 'strong' revenue growth despite challenges
By: Reuters | February 23, 2022
CHICAGO (Reuters) - General Electric (NYSE:GE) Co expects to have "strong" revenue growth this year despite inflationary and supply-chain challenges, Chief Executive Larry Culp said on Wednesday.
The comments came days after the industrial conglomerate warned that supply and labor shortages along with inflation would pressure its profits through the first half of the year.
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$GE Weekly Chart. Inverse head and shoulders candidate
By: ReciKnows | February 21, 2022
• $GE Weekly. Inverse head and shoulders candidate.
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General Electric (GE) Given Average Rating of "Buy" by Brokerages
By: MarketBeat | February 18, 2022
• Shares of General Electric (NYSE:GE) have received a consensus rating of "Buy" from the eighteen ratings firms that are presently covering the company, Marketbeat reports. Five analysts have rated the stock with a hold recommendation and twelve have issued a buy recommendation on the company. The average 12 month price objective among brokers that have issued ratings on the stock in the last year is $119.38...
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General Electric Stock Slides On Supply Chain, Labor Cost Hit to 2022 Profit Outlook
By: TheStreet | February 18, 2022
• GE said Friday that the "magnitude" of supply chain and cost challenges could pressure its near-term profit forecasts.
General Electric (GE) shares extended declines Friday after the industrial group said it expects supply chain and cost pressures to last into at least the second half of the year.
GE said that, while the pressures were included in the group's overall profit guidance, published late last month, "the magnitude of these challenges likely present pressure to overall growth, profit and free cash flow through the first quarter and the first half, beyond typically expected seasonality. "
GE had said on January 25 that it sees free cash flow in the region of $5.5 billion to $6.5 billion -- up from $2.6 billion in 2021 -- a figure that will improve to $7 billion in 2023. Adjusted earnings were pegged in the region of $2.80 to $3.50 per share - well shy of the Street consensus forecast of $4.00 per share, although that figure is based on an outdated reporting format.
"While we are seeing progress on our strategic priorities, we continue to see supply chain pressure across most of our businesses as material and labor availability and inflation are affecting Healthcare, Renewable Energy and Aviation," GE said in a Securities and Exchange Commission filing. "Although varied by business, we expect these challenges to persist at least through the first half of the year."
General Electric shares were marked 4.6% lower in late-morning trading to change hands at $94.53 each.
General Electric said adjusted non-GAAP earnings for the three months ending in December were pegged at 92 cents per share, up 48% from the same period last year and 7 cents ahead of the Street consensus forecast.
Group revenues, General Electric said, fell 7.4% to $20.303 billion, coming in well shy of analysts' estimates of a $21.48 billion tally.
Our dramatic debt reduction means we can further intensify efforts to strengthen our operations and play offense, setting us up to deliver between $5.5 to $6.5 billion free cash flow in 2022 and more than $7 billion in 2023," CEO Larry Culp told investors in late January.
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Bear of the Day: General Electric (GE)
By: Zacks Investment Research | February 16, 2022
General Electric (GE)is a Zacks Rank #5 (Strong Sell) that is a high-tech industrial company that operates all over the world. It operates through four segments: Power, Renewable Energy, Aviation, and Healthcare segments.
The company has struggled over the last decade as poor earnings and too much debt drove the stock lower and lower. However, GE has been trying to turn things around by spinning off some divisions and going through a reverse stock split.
While the stock is well off its 2020 lows, investors might be getting ahead of themselves as it teases levels just below 2021 highs.
About the Company
General Electric is headquartered in Boston, MA and employs over 168,000. The company was founded in 1892 and has become a household name.
While the stock saw huge success over its history, the financial crisis brought GE to its knees. After a decade of struggle, GE is now valued at $110 billion. It has a Forward PE of 27, which gives it a Zacks Style Score of “D” in Value. While there are valuation questions, the stock has a Zacks Style Score of “A” in Growth.
Q4 Earnings
General Electric saw a Q4 earnings beat of 10% in late January. However, revenues came in below expectations and the company guided FY22 lower. FY22 is now expected to come in at $2.80-3.50 v the $4.05 expected.
While the guide was pretty bad, there were some positives. The company sees FY22 organic revenue at “high single digits growth” and guided FY23 FCF on path to greater than $7 Billion.
Management commented on opportunities for sustainable profit growth and sees the dramatic debt reduction as a way to “play offense”.
While the quarter gave some reasons for the bulls to buy the stock, analysts have lowered estimates since the earnings report.
Estimates
Over the last month, estimates have dropped across all time frames. For the current quarter, we see seen a drop from $0.61 to $0.41, or 32%. For the current year, we see a drop of 12%, from $4.05 to $3.54.
Technical Take
The stock saw a reverse stock split over the summer. This took the stock to the $100-105 area, where it traded until it spiked to $116 in early November. From there, it went straight down to $90 on a market sell off.
Since then, the stock has traded under the 200-day Moving average, hitting new 2021 lows after Q4 earnings.
However, the stock has bounced nicely since then and is back to that $100 area. Investors should be cautious at current levels as the stock approaches the 200-day MA once again. If GE can get over $106, the bulls could be in the clear. If the 200-day holds again, watch out for a move back to that $90 area.
In Summary
General Electric is a household name, but the stock performance over the last decade has helped people forget what it used to be.
For now, a better diversified conglomerate option might be Griffon Corporation (GFF). The stock is a Zacks Rank #1 (Strong Buy) and the company is coming off a 200% EPS beat about a month ago.
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General Electric Stock Is Soaring. The Annual Report Has Provided a Boost
By: Barron's | February 15, 2022
General Electric stock is higher Tuesday. The market is up, as well, and upbeat company-specific Wall Street commentary is also helping. Bank of America analyst Andrew Obin wrote Tuesday that GE is making progress on “several fronts.”
GE (ticker: GE) stock is up 4.7% in midday trading. The S&P 500 and Dow Jones Industrial Average are up about 1.3% and 1%, respectively.
It’s a bigger-than-market move for the industrial conglomerate, and the reason for improving analyst sentiment is the annual report. GE filed its 2021 report on a form 10-K with the Securities and Exchange Commission this past Friday. Analysts have been studying the document for a couple of days.
“The 2021 10-K filing highlights GE’s progress in reducing legacy issues,” wrote Obin in a Tuesday report.
GE is ending the sales of its accounts receivable, a practice called factoring receivables that the company had used to bring in cash to the industrial operations. GE Chief Financial Officer Carolina Dybeck Happe has said GE became too reliant on factoring, and end-of-quarter billing in its management of cash and sales numbers. Ending factoring makes the company’s figures more transparent.
What’s more, retiree pension plans are now back above 80% funded on an accounting basis. That’s a healthy level of pension funding, and GE won’t have to contribute as much cash to bolster it.
Obin also pointed out that corporate costs are falling and, most important, the aviation recovery is on track. Aviation orders grew 19% year over year in 2021 and “drove backlog to exceed pre-Covid levels,” wrote the analyst.
He isn’t the first to comment on GE’s annual report. Wolfe Research analyst Nigel Coe wrote Monday there are “more green flags than red” in the annual report. He added the report shows how GE has morphed into a “normal” company. In the past, GE annual reports were more complicated.
Simplification seems to be doing the trick for GE stock Tuesday.
Coe and Obin, for their parts, both rate GE stock at Buy. Coe’s price target is $127, and Obin’s target is $132. Both are a more bullish than the average analyst. The average analyst price target for GE stock is $117 a share, implying gains of about 17% from recent levels.
Overall, about 71% of analysts covering GE rate shares at Buy. The average Buy-rating ratio for a stock in the S&P 500 is about 58%.
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GE Stock Could Light Up Your Portfolio. Here’s Why
By: Barron's | February 5, 2022
General Electric was once known as the company that brings good things to life—but so far this century, holding shares of the conglomerate has been a portfolio killer.
That all may soon change, according to Barron’s senior writer Al Root.
His take: General Electric ‘s (ticker: GE) plans to split into three companies—with one division focused on aviation, one on healthcare, and one on energy—represent a buying opportunity for investors.
That assertion goes against conventional thinking: Breakups are tough to execute—and while companies may be worth more when they’ve split up, investors are often skittish about parking their money in stocks that are undergoing rapid changes.
But GE may be worth it in the long-term. Root recently performed sum-of-the-parts analysis, putting GE’s market cap at $140 billion—30% higher than the company’s recent trading levels. Waiting for the breakups to be finished in two years may cause some frustration, but investors won’t be biding their time: GE chief executive Larry Culp will continue to improve the existing businesses.
In a recent post on LinkedIn, Culp reiterated his plans to strengthen GE amid the looming changes. “Our continued deleveraging and scaling of lean company-wide will further solidify our financial position and allow GE to play more offense through organic and inorganic growth opportunities,” Culp wrote.
While the breakups make financial sense, some are saddened to see the dismantling of an iconic American company. GE is 130 years old and was one of the first members of the Dow Jones Industrial Average. At its height, GE’s businesses touched everything including media, tech, manufacturing, and finance.
“We know GE looms large and that casts a long shadow,” Culp told Root in a recent interview. “Because memories are long, the backward look is not uncommon. But I think, increasingly, it’s going to be a dated lens. That’ll be a good thing for everybody involved with the company.”
GE shares are up 4.8% so far this year, recently changing hands at about $99 apiece and outperforming the 3% drop in the S&P 500.
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Oppenheimer Research Analysts Lower Earnings Estimates for General Electric (GE)
By: MarketBeat | January 31, 2022
• General Electric (NYSE:GE) - Investment analysts at Oppenheimer cut their Q1 2022 earnings estimates for General Electric in a research report issued on Wednesday, January 26th. Oppenheimer analyst C. Glynn now expects that the conglomerate will earn $0.41 per share for the quarter, down from their prior forecast of $0.61. Oppenheimer also issued estimates for General Electric's FY2022 earnings at $3.25 EPS...
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Q2 2022 EPS Estimates for General Electric Cut by Analyst (GE)
By: MarketBeat | January 28, 2022
• General Electric (NYSE:GE) - Research analysts at Oppenheimer decreased their Q2 2022 earnings per share estimates for shares of General Electric in a research report issued on Wednesday, January 26th. Oppenheimer analyst C. Glynn now expects that the conglomerate will earn $0.70 per share for the quarter, down from their previous estimate of $0.81. Oppenheimer also issued estimates for General Electric's Q3 2022 earnings at $0.85 EPS, Q4 2022 earnings at $1.29 EPS and FY2023 earnings at $5.50 EPS. General Electric (NYSE:GE) last announced its quarterly earnings results on Tuesday, January 25th. The conglomerate reported $0.92 earnings per share for the quarter, topping the consensus estimate of $0.85 by $0.07. General Electric had a negative net margin of 0.05% and a positive return on equity of 5.88%. The company had revenue of $20.30 billion for the quarter, compared to analysts' expectations of $21.32 billion. During the same quarter in the previous year, the business posted $0.64 earnings per share. General Electric's quarterly revenue was down 7.4% on a year-over-year basis...
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General Electric (GE) Upgraded to "Hold" at Zacks Investment Research
By: MarketBeat | January 27, 2022
• General Electric (NYSE:GE) was upgraded by Zacks Investment Research from a "sell" rating to a "hold" rating in a report released on Thursday, Zacks.com reports. The brokerage presently has a $94.00 price target on the conglomerate's stock. Zacks Investment Research's target price suggests a potential upside of 4.63% from the stock's current price...
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General Electric (GE) Stock Slides After Q4 Revenue Miss, 2022 Outlook
By: TheStreet | January 25, 2022
• A weaker-than-expected 2022 earnings outlook, and softer Q4 revenues have GE stock trading lower Tuesday, but a new reporting format makes comparisons for the industrial giant difficult.
General Electric (GE) posted stronger-than-expected fourth quarter earnings Tuesday, but fell short of revenue forecasts and issued a weak 2022 profit outlook, sending shares in the industrial group lower in pre-market trading.
General Electric said adjusted non-GAAP earnings for the three months ending in December were pegged at 92 cents per share, up 48% from the same period last year and 7 cents ahead of the Street consensus forecast. Group revenues, General Electric said, fell 7.4% to $20.303 billion, coming in well shy of analysts' estimates of a $21.48 billion tally.
Looking into the coming financial year, GE said it sees free cash flow in the region of $5.5 billion to $6.5 billion -- up from $2.6 billion in 2021 -- a figure that will improve to $7 billion in 2023. Adjusted earnings were pegged in the region of $2.80 to $3.50 per share - well shy of the Street consensus forecast of $4.00 per share, although that figure is based on an outdated reporting format.
Industrial free cash flow for the quarter, a key GE profit metric, topped Street forecasts by $700 million at $3.8 billion.
“2021 was an important year for the GE team, marked by significant strategic, operational, and financial progress," said CEO Larry Culp. "We delivered solid margin, EPS, and free cash flow performance in 2021, exceeding our outlook. Orders for the year were up double digits, supporting faster growth going forward, while supply chain challenges, commercial selectivity, and uncertainty surrounding the U.S. wind production tax credit impacted our top-line."
“We're seeing real momentum and opportunities for sustainable profitable growth from near-term improvements in GE's businesses, especially as Aviation recovers and our end markets strengthen. Our dramatic debt reduction means we can further intensify efforts to strengthen our operations and play offense, setting us up to deliver between $5.5 to $6.5 billion free cash flow in 2022 and more than $7 billion in 2023."
General Electric shares were marked 5.3% lower in pre-market trading immediately following the earnings release to indicate an opening bell price of $91.75 each.
GE's 2022 outlook is based on a new 'single line' reporting format, which will no longer include GE Capital as a stand-alone division.
General Electric unveiled plans in early November to split into three separate companies, marking one of the most significant changes in the industrial giant's 130-year history.
General Electric will form three different companies -- focusing on energy, healthcare and aviation -- with current CEO Larry Culp tabbed as non-executive chairman of the developing healthcare group -- which will be run by Peter Arduini -- when it is spun-off in 2023.
Tax-free spinoffs of the energy and power divisions will occur in 2024, as they're combined into a single group lead by Scott Strazik, General Electric said. The bulk of the existing company remaining in place -- with the GE name -- to focus on aviation and will be lead by John Slattery.
Collectively, the separations will cost around $2.5 billion, GE said, when taxes and operational expenses are ultimately tallied.
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General Electric Could Drop into the 60s
By: Alan Farley | January 24, 2022
• The stock has spent two months testing new resistance, with last week’s selloff likely to continue in coming weeks.
General Electric Co. (GE) reports Q4 2021 earnings in Tuesday’s pre-market, with analysts expecting the company to post a profit of $0.82 per-share on $21.35 billion in revenue. If met, earnings-per-share (EPS) will mark a tenfold improvement compared to the same quarter last year. However, GE issued a 1-for-8 reverse split in August, so the uptick isn’t nearly as dramatic. The stock topped out in March 2021 and broke down from range support in November.
Reorganization Continues Amid Headwinds
The company is breaking into three pieces, with aerospace, healthcare, and power generation divisions defining new profit centers. Healthcare is a sore thumb right now, as evidenced by a decline in reported sales from $19.9 billion in 2019 to $17.9 billion in the four quarters ending in September. GE is also dealing with heavy debt payments in a rising interest rate environment so refinancing will be more expensive going forward.
CEO Larry Culp outlined GE’s challenges in a weekend Barron’s interview, noting “Is there some deal limbo? Perhaps. But with Omicron, GE is trading in line with the sector. We’re going to continue to drive improvement. I think the story continues to be about our performance. Whether you’re looking at the performance trajectory of this business, or looking at the pieces, I think there’s going to be more appeal.”
Wall Street and Technical Outlook
Wall Street consensus yields a ‘Moderate Buy’ rating based upon 12 ‘Buy’, 2 ‘Overweight’, 9 ‘Hold’, 0 ‘Underweight’, and 0 ‘Sell’ recommendations. Price targets currently range from a low of $94 to a Street-high $145 while the stock is set to open Monday’s session just a buck above the low target. This disconnect with Main Street investors highlights broad-based concern about rising inflation and its impact on quarterly profits.
General Electric has posted lower highs since topping out in 2000. The last intermediate uptrend ended above 250 in 2016, ahead of a steep downtrend that posted a 27-year low in 2020. Positive price action into the first quarter of 2021 stalled at the 200-week moving average, yielding a sideways pattern that broke support in the mid-90s in November. The stock has spent the last two months testing new resistance, with last week’s selloff likely to continue in coming weeks.
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GE suspends COVID-19 vaccine or test requirement after U.S. Supreme Court's ruling
By: Reuters | January 14, 2022
CHICAGO (Reuters) - General Electric (NYSE:GE) Co on Friday said it has suspended COVID-19 vaccine or test requirement for employees after the U.S. Supreme Court's ruling.
The court on Thursday blocked President Joe Biden's COVID-19 vaccination-or-testing mandate for large businesses - a policy the conservative justices deemed an improper imposition on the lives and health of many Americans - while endorsing a separate federal vaccine requirement for healthcare facilities.
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GE Gains on Credit Suisse Upgrade to Outperform With $122 Target
By: Investing.com | January 4, 2022
General Electric stock (NYSE:GE) traded 3.5% higher Tuesday after Credit Suisse rated it outperform with a target of $122, up 22% from the current level of $100.
GE’s shares have lost around 14% since the company’s Nov. 9 decision to split into three businesses – healthcare, energy and aviation. The company plans to keep around 20% in the healthcare business.
Analyst John Walsh believes the pullback has created an opportunity for an outperformance in 2022 as GE reaps the benefits of a cyclical recovery in 2022.
“We also see potential for a “rush for propulsion” as airline customers have managed green time throughout the pandemic. In December, GE noted that aviation revenue and FCF (free cash flow) could return to pre-pandemic levels in 2023. We think cyclical recovery and FCF execution will drive the stock higher, despite a “lack of catalyst” narrative into the spinoffs,” Walsh said in his note, according to StreetInsider.
Walsh points out that unlike other large conglomerate simplification, GE has positively revised guidance.
GE is aiming for all three units to have investment grade debt ratings. It said in November it was on course to reduce debt to 2.5 times earnings before interest, taxes, depreciation and amortization by the end of this year, which is the rough rule of thumb for corporate investment grade debt.
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General Electric (GE) Receives Average Recommendation of "Buy" from Brokerages
By: MarketBeat | December 30, 2021
• General Electric (NYSE:GE) has received an average rating of "Buy" from the eighteen ratings firms that are presently covering the stock, MarketBeat.com reports. One analyst has rated the stock with a sell recommendation, six have issued a hold recommendation and ten have assigned a buy recommendation to the company. The average 1-year price target among brokerages that have updated their coverage on the stock in the last year is $123.87...
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Research Analysts Offer Predictions for General Electric's FY2021 Earnings (GE)
By: MarketBeat | December 24, 2021
• General Electric (NYSE:GE) - Investment analysts at Oppenheimer dropped their FY2021 earnings estimates for General Electric in a report released on Tuesday, December 21st. Oppenheimer analyst C. Glynn now expects that the conglomerate will post earnings per share of $1.97 for the year, down from their previous forecast of $2.05. Oppenheimer also issued estimates for General Electric's FY2023 earnings at $5.70 EPS. General Electric (NYSE:GE) last released its earnings results on Monday, October 25th. The conglomerate reported $0.57 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.43 by $0.14. The company had revenue of $18.43 billion during the quarter, compared to the consensus estimate of $19.17 billion. General Electric had a negative net margin of 0.05% and a positive return on equity of 5.88%. The company's revenue was down .5% compared to the same quarter last year. During the same quarter in the prior year, the firm earned $0.48 EPS...
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General Electric (GE) Expected to Post Quarterly Sales of $21.33 Billion
By: MarketBeat | December 14, 2021
• Brokerages predict that General Electric (NYSE:GE) will post $21.33 billion in sales for the current fiscal quarter, Zacks reports. Four analysts have made estimates for General Electric's earnings. The lowest sales estimate is $20.42 billion and the highest is $22.01 billion. General Electric posted sales of $21.93 billion in the same quarter last year, which suggests a negative year over year growth rate of 2.7%. The firm is scheduled to issue its next quarterly earnings results on Tuesday, January 25th...
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Deutsche Bank Aktiengesellschaft Trims General Electric (GE) Target Price to $119.00
By: MarketBeat | December 10, 2021
• General Electric (NYSE:GE) had its price objective reduced by equities researchers at Deutsche Bank Aktiengesellschaft from $131.00 to $119.00 in a report released on Friday, The Fly reports. The brokerage presently has a "buy" rating on the conglomerate's stock. Deutsche Bank Aktiengesellschaft's target price suggests a potential upside of 21.68% from the company's previous close...
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General Electric Given New $122.00 Price Target at Barclays
By: MarketBeat | December 6, 2021
• General Electric (NYSE:GE) had its target price dropped by equities researchers at Barclays from $128.00 to $122.00 in a research note issued to investors on Monday, Benzinga reports. The brokerage presently has an "overweight" rating on the conglomerate's stock. Barclays's price objective indicates a potential upside of 31.51% from the company's current price...
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General Electric (GE) Receives Consensus Recommendation of "Buy" from Brokerages
By: MarketBeat | December 5, 2021
• Shares of General Electric (NYSE:GE) have earned an average rating of "Buy" from the twenty research firms that are covering the company, MarketBeat.com reports. One equities research analyst has rated the stock with a sell rating, seven have assigned a hold rating and eleven have issued a buy rating on the company. The average twelve-month target price among analysts that have covered the stock in the last year is $122.12...
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GE Stock Coverage Resumed at Morgan Stanley With Overweight Rating
By: TheStreet | November 23, 2021
• Analysts say GE has evolved over the last four years with it now in deleveraging mode.
Shares of General Electric (GE) were rising slightly Tuesday afternoon after analysts at Morgan Stanley resumed coverage of the company with an overweight rating and $125 price target.
Analysts at the firm see the narrative changing for the company after a four-year transition.
"The GE narrative has evolved over the last 4 years from de-risking pension, insurance, and market swings in Power. Now it's deleveraging and the Aviation upcycle. We believe the next phase could be the underappreciated strategic value of the pieces, particularly Aviation," analyst Joshua Pokrzywinski said.
Morgan Stanley notes that GE has reduced the risk of its power division, leverage/pension and insurance over the past three years.
Despite those developments, GE shares have been range-bound for the most part of the past two years.
GE shares were up 0.6% to $101.63 at last check Tuesday afternoon. Shares are up just 10% over the past two years.
"We fully expect shares to be more volatile than most industrials around Covid trends given aero exposure but believe the risk/reward over the next year is attractive with a ~2.7:1 bull/bear spread," Pokrzywinski.
Recently GE announced that it will be splitting into three companies. This could serve as another catalyst for the company, according to Morgan Stanley.
"The breakup and related sum of the parts discussion has rarely unlocked significant value on its own, but peer valuation looks misleading and there is new strategic optionality," Pokrzywinski said. "We're particularly intrigued by the future for Aviation."
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General Electric (GE) Director Buys $107,060.00 in Stock
By: MarketBeat | November 16, 2021
• General Electric (NYSE:GE) Director Paula Rosput Reynolds purchased 1,000 shares of General Electric stock in a transaction dated Friday, November 12th. The shares were purchased at an average price of $107.06 per share, for a total transaction of $107,060.00. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website...
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After The General Electric Breakup Announcement Is GE Stock A Buy?
By: Investing.com | November 18, 2021
After years of corporate decline and its stock underperformance, General Electric (NYSE:GE) has finally played its best card in order to win back investor confidence.
The 129 year-old Boston-based industrial conglomerate, which is in the middle of a turnaround, announced last week that it plans to split into three public companies, encompassing its healthcare, aviation and energy businesses, as part of a breakup that will unlock value for its shareholders.
GE will spin off its healthcare business in early 2023 and combine its renewable energy, fossil fuel power and digital units into a single, energy-focused entity that will be spun off a year later. The remaining business will form GE Aviation, its jet-engine division.
Chief Executive Officer Larry Culp, who took the helm in 2018 to transform the struggling industrial giant, called the announcement a “defining moment” for GE.
Culp, during the past three years, bolstered the company’s cash flows by selling major businesses, which included a $30-billion deal to sell its jet-leasing business. Its biotech business was purchased by Danaher (NYSE:DHR) in a $21-billion deal, and the sale of the bulk of the GE Capital finance arm was brokered before Culp's tenure as CEO.
GE shares closed Wednesday at $101.99. The stock price, adjusting for the split, is little changed from where it was when Culp took over in October 2018, compared with a roughly 60% gain in the S&P 500 index. Existing GE shareholders will receive new shares in the two companies after they are spun off.
GE Weekly Chart.
A Clear Rationale
Some of GE’s largest investors are favoring this latest move, which could be the final act in dismantling the conglomerate that was the world’s largest company 20 years ago, with a market capitalization at that time of $401 billion.
In a statement, Trian Fund Management, the activist fund led by Nelson Peltz that amassed a $2.5-billion stake in GE in 2015, said:
“The strategic rationale is clear: three well-capitalized, industry leading public companies, each with deeper operational focus and accountability, greater strategic flexibility and tailored capital allocation decisions.”
The energy unit holding GE’s renewable and fossil-power businesses should achieve mid- to high-single-digit margins even with low rates of growth. GE Aviation’s margins could reach 20%, according to GE’s investor presentation.
Analysts, on the other hand, give a favorable rating to GE stock, which has so far failed to live up this development. Of 20 analysts, surveyed by Investing.com, 12 have an “outperform” rating on the stock, with the 12-month consensus price target reflecting a more than 22% upside.
Consensus Estimates of Analysts Surveyed By Investing.com.
Chart: Investing.com
Deane Dray, an analyst with RBC Capital Markets, said in a note last week that the breakup could generate 20% upside to GE’s current share price, and the move will help management to unlock an “attractive” value for GE shareholders. His note added:
“We are fans of the plan and believe the company is embarking on the three-way separation from a position of strength.”
Bottom Line
GE stock may not show much positive momentum in the near-term as both retail and institutional investors remain focused on tech high-flyers or meme stocks. The complex turnaround story that GE has become is, in comparison, simply less enticing.
But for long-term investors, GE’s latest move represents a good buying opportunity now that the company has settled on a plan to take advantage of its leading market position, especially in healthcare and aviation. For such investors, building up a gradual position in GE stock, with a three-to-five-year horizon, could prove to be a productive move in our view.
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GE Aviation ready to look at acquisitions, eye on systems
By: Reuters | November 15, 2021
DUBAI (Reuters) -GE Aviation is ready to look at acquisitions if needed to bring in complementary technologies capable of shaping the future of flight, without waiting for a planned break-up of its parent General Electric (NYSE:GE), its top executive said on Monday.
"(If there is) alignment with our strategic goals and assuming that the business case makes sense, we are open to look at opportunities," GE Aviation Chief Executive John Slattery told Reuters.
"I want to be clear that our opportunities to be strategic in the market place are effective today," he said in an interview at the Dubai Airshow, adding such opportunities "probably run deeper and wider" in systems than in jet engines.
However, he stressed GE Aviation felt under "no pressure" to make external investments.
General Electric (GE) last week announced plans to spin off its businesses into three public companies, marking the end of the 129-year-old conglomerate.
The Boston-based company will separate the healthcare company in early 2023. It will combine GE Renewable Energy, GE Power and GE Digital and spin off the business in early 2024.
Following the split, it will become an aviation company, helmed by Chairman and Chief Executive Larry Culp.
The aviation company will inherit GE's other assets and liabilities, including its runoff insurance business.
Slattery said GE Aviation had not been placed under any restrictions by Culp or the board limiting its ability to look at adjacent technologies "or other inorganic opportunities" as long as they fit the strategy and had a good business case.
"If they do, we are not time-bound in terms of waiting until the spin-offs occur," Slattery said.
"When I think about our franchise footprint in commercial aviation, in military aviation and now increasingly in our systems business, those are the areas I want to continue to grow," he added.
"I think it is probably fair to say the opportunities to broaden the aperture ... probably run deeper and wider in our systems business than they would in inorganic (acquisition) opportunities on the commercial or military engine front."
Analysts say high-tech systems and associated technologies are key to the future of aircraft which will see a more seamless integration between powerplants and airframes than in the past.
GE Aviation's main competitor in engines for in-demand narrowbody commercial jet engines and in military jet engines, Pratt & Whitney, is part of the Raytheon Technologies (NYSE:RTX) conglomerate that combines a broad slate of aircraft systems.
In the past three years, Culp has focused on reducing debt by selling assets, and improving cash flows by streamlining operations and cutting overhead costs.
After a $30 billion deal in March to merge GE's jet-leasing unit with Ireland's AerCap, Culp said GE would look to "play more offense" to grow its industrial business.
Since then, the company has pursued "bolt-on" acquisitions in the healthcare space.
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FY2023 EPS Estimates for General Electric (GE) Boosted by Oppenheimer
By: MarketBeat | November 12, 2021
• General Electric (NYSE:GE) - Analysts at Oppenheimer lifted their FY2023 earnings estimates for shares of General Electric in a research note issued on Tuesday, November 9th. Oppenheimer analyst C. Glynn now forecasts that the conglomerate will post earnings per share of $5.80 for the year, up from their prior forecast of $5.30. General Electric (NYSE:GE) last announced its earnings results on Monday, October 25th. The conglomerate reported $0.57 earnings per share for the quarter, topping the Zacks' consensus estimate of $0.43 by $0.14. The firm had revenue of $18.43 billion during the quarter, compared to analyst estimates of $19.17 billion. General Electric had a negative net margin of 0.05% and a positive return on equity of 5.88%. The company's revenue for the quarter was down .5% compared to the same quarter last year. During the same period in the prior year, the business earned $0.48 EPS...
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Cowen Increases General Electric (GE) Price Target to $126.00
By: MarketBeat | November 10, 2021
• General Electric (NYSE:GE) had its price target upped by investment analysts at Cowen from $108.00 to $126.00 in a report released on Wednesday, Briefing.com reports. The firm currently has a "market perform" rating on the conglomerate's stock. Cowen's target price would suggest a potential upside of 14.40% from the company's current price...
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Hint. I believe I started my post out with the words “split adjusted”.
Read a little closer I guess.
Jetmek_03052
I think you forgot about the BIG R/S , what was it 1 for 8 or 1 for 10 ??
Maybe you should go back to school and take a math course
jmho
Hint i retired after 34 years at good old GE
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UNDER CONSTRUCTION
General Electric Company (GE) develops, manufactures, and markets various products for the generation, transmission, distribution, control,
and utilization of electricity worldwide. Its products primarily include various appliances, lighting and industrial automation products,
medical diagnostic imaging systems, bioscience assays and separation technology products, electrical distribution and control equipment, locomotives,
power generation and delivery products, nuclear power support services and fuel assemblies, commercial and military aircraft jet engines, and
security equipment and systems, as well as engineered materials, such as plastics and silicones.
The company also offers turbomachinery products and services for the production, transportation, storage, refining, and distribution of oil and natural gas;
and provides specialty chemicals, pumps, valves, filters and fluid handling equipment for improving the performance of water, wastewater, and process systems.
In addition, GE sells and services various home appliances, as well as rents, leases, sells, and manages commercial and transportation equipment.
Further, it offers various product services; electrical apparatus installation, engineering, and repair and rebuilding services; and aircraft maintenance,
component repair and overhaul services, including sales of replacement parts.
Additionally, the company produces and delivers network television services, operates television stations, produces and distributes motion pictures,
and operates cable/satellite networks, theme parks, and program activities in multimedia and the Internet. GE also offers a range of financial and other services,
including consumer financing, commercial and industrial financing, real estate financing, asset management and leasing, mortgage services,
consumer savings and insurance services, and reinsurance.
The company was founded in 1892 and is based in Fairfield, Connecticut.
http://www.ge.com/
Hisory of GE
http://www.schenectadyhistory.org/ge/index.html
https://finviz.com/quote.ashx?t=GE
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