I have conversed with many investors who take an honest interest in the environment and what I would describe as "Green Investing." I believe General Electric (GE) to be one of those companies that a green investor should take a look at. Why would I suggest this? In a phrase, wind power.
Wind power has been growing quietly and steadily in the U.S. for a decade now, from a modest start of 4 gigawatts to 40 gigawatts today. General Electric is one of the world's largest wind turbine suppliers with over 15,000 turbine installations around the world that have amounted to 218 million operating hours and 127,000 GWh of energy produced. Wind facilities exist in Germany, Norway, China, Canada, and the United States. The company sells the turbines and offers services that support developmental assistance and maintenance.
The company's investment in "Green Energy" surpassed $4 billion a few years back, and it continues to be one of the fastest growing divisions of the company. This is one of the things that makes GE such a great investment for the green-minded investor. Wind energy is a win-win for the company because it adds energy assets to its portfolio, and at the same time, expands the market for its turbines. It also provides contractual work to provide support, service and maintenance for these. The recent agreement with Taiwan is a good example of this.
GE recently teamed up with Taiwan Power Company to provide service, maintenance, parts, and upkeep of the 26 GE 1.5 MW wind turbines it has installed. They can power about 28,000 Taiwanese homes yearly. This is the most recent example of GE's turbine market. In fact, another example is the 470 MW wind farm in Flat Ridge Kansas, one of the largest commercial wind farms in America. It uses 294 GE 1.6 MW turbines.
Additionally, General Electric is leading a consortium of companies that will buy a series of French wind parks from Iberdrola SA, the largest utility company in Spain. The portfolio includes 32 wind parks with a capacity of 321.4 megawatts. Just how much power is this? Well, one megawatt can power roughly 1000 homes for a year, so this purchase can power 321,400 homes for a year. That is about 1/10 the size of New York City by itself. General Electric will have a 40% ownership in the consortium. GE has a hand in a number of large wind farms.
GE also partnered with JP Morgan to own the 662.5 MW Capricorn Wind farm in west Texas about a year ago. It has also invested $115 million in India to help build 500 MW's of power through wind farms across the country. The Indian company, Greenko Wind Private Project (GWPP) Limited, will create enough renewable electricity to power 875,000 average Indian households and displace 700,000 tons a year of greenhouse gas emissions.
A few years back, the company provided GE 2.5 MW wind turbines and a service contract for the Shepherd's Flats wind farm in Oregon. The wind farm was completed last year, and was expected to generate 845 MW of power and light up 235,000 homes. These are numerous examples of how GE has invested globally in renewable wind energy.
Long-Term Investing In General Electric
I believe that GE will break out soon, and the direction will depend upon global market conditions. Three-fourths of the analysts watching the stock right now rate the company a buy or strong buy. With a respectable dividend of 3.6%, it is also a dependable company for income oriented investors. The largest conglomerate has what the green investor wants: renewable energy investments, a solid core, and good dependable dividends.
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Technically Speaking
Since its high of about 23 back in early October, the stock looks like it has been consolidating since then as the highs get lower and the lows get higher. General Electric has been moving from the top to the bottom of the Bollinger bands, and the bands recently look like they are finally moving sideways. The RSI appears to be mirroring the movement of the stock with the same pattern. Highs and lows are shrinking. The MACD is no different ,as it is ending up trading close to the "0" line. The stock may be close to a break out point.
