GE Merrill Downgrade is a SHAM
Merrill Lynch came out and decided that GE needed another spanking today, as Lehman’s down grade evidently was not enough they decided to cut their 12-month stock-price target to $28 from $35 and they lowered earnings forecasts.
General Electric fell 7.2% to $24.47 on Friday, after Lehman Brothers downgraded the company’s earnings target and estimates on the stock, citing worries about the stalling short-cycle business. Lehman cut their rating after GE indicated they were less positive about results going forward. While Lehman highlighted an earnings risk in 2003, Merrill believes that 2004 could be an even more difficult year for General Electric. What a blatant SHAM, these analheads can’t predict the current or next quarter, but thy want you to believe they are accurate 12-24 months out…"While 2003 is shaping up to be a challenging year for GE, we caution that 2004 could be as challenging, if not more challenging, as the company faces its greatest 'headwinds' at Power, as domestic gas-turbine units are forecast to fall to 50 from 260 this year," Merrill analyst John Inch said. A skewed statement as the forecast is for 75; however GE expects foreign sales to more than offset the domestic reduction. After the dismal out Merrill painted, they did not change their buy recommendation on the stock a logical conclusion NOT!! They reduced their 2002 earnings-per-share estimate to $1.63 from $1.65 and its 2003 forecast to $1.70 from $1.78. The third-quarter estimate stays unchanged at $0.41, while the fourth-quarter number falls to $0.43 from $0.45. Inch agrees with Lehman that a slightly more sluggish economy near-term should pressure the short-cycle business. Inch now expects short-cycle operating profit next year of $4.7 billion, against the $5 billion that GE had targeted at last May's Electrical Products Group conference.
ANALHeads should be locked in a full porter-potty and then rolled down a large hill
JMHO
Steve
