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Shares of General Electric (NYSE:GE) continue to trade for just eleven dollars after the most recent quarterly report showed that the company's profits got hammered to the tune of a nearly 50% cut in the most recent earnings report. (Call Transcript)

The huge loss in profit can be attributed to a lackluster performance by the GE financial services division, as expected, and a general lack of demand for GE products as a result of the recession. It's also worth mentioning that the NBC/Universal division has become a significant drag on the company.

As a small investor, I always like an opportunity to jump on a stock when no one else likes it because if no one else likes it, then the stock is usually trading for a discount. Big money can profit quickly by moving into stocks as they are ready to make a move to the upside (or downside in cases of short positions), but small money- not able to afford to miss big percentage returns that result from the beginning of a run- needs to buy for a discount and then wait in order to see significant returns.

In other words, the job of the small investor is to find stocks with potential that are either undervalued or flying under the radar and buy into them before a run starts.

It could take months, or sometimes years, for the returns to arrive by using this style of investing, but the returns - if you find a good one - are usually pretty significant and well worth the wait (CSUH.OB, DNDN, OTCQB:TTNP, etc.).

In my opinion, GE is a stock with potential that is trading cheap because the recession has this company's growth going in reverse. Big money (aside for Warren Buffett) won't play with this stock right now because there is money to be made elsewhere, but that means that it's time for the small investor to step in and buy.

The big argument against General Electric right now, aside from the problems at the financial division, is that every aspect of the company will suffer dramatically during the recession because its products touch every facet of the economy. Simply put, people aren't spending money on anything right now and GE is involved with just about everything that people would spend money on.

The counter-argument is that when an economic recovery takes place, General Electric, since it was hit worse than most companies during the recession, will be in a prime position to benefit more than most companies because of the same logic. GE products touch every facet of the economy and when people start spending money again, GE stands to return to booming profits.

A complete turnaround will not be so cut and dry, however.

The financial arm is still in the pits and as long as the economy is in recession, there may be no apparent end in sight. Although CEO Jeff Immelt declared that GE Capital will be profitable this year, an encouraging sign to say the least, I'll believe it when I see it as bad loans continue to be written off.

Additionally, the NBC / Universal division of the company has lost nearly half of its value while under GE stewardship. The reason why no one watches NBC anymore, and therefore has the network losing advertising revenue, is because the network puts personal politics and opinions before quality programming. It's that simple.

If the 'Today' show or the hosts at MSNBC would just report the news instead of telling it with a political spin, the ratings would rise again; that is, if the NBC name for credibility is not already damaged beyond repair.

GE would be better off selling NBC/Universal at this point and swallowing the loss. It's like writing off bad debt- take the loss, regain your footing and move on. Otherwise GE will be pouring money into the sinking ship that is NBC- unlike the Titanic, however, no one will be watching the ship at NBC sink.

Amid all the negatives, General Electric still has a lot playing in its favor; cutting edge electrical grids that could shape the future of delivering electricity around the world, a slew of government contracts coming in, including a $3 billion order from Iraq for gas turbines, and a long list of products that, as I said before, touch every facet of the global economy.

The worst may not be over yet for General Electric, especially if the recession continues for longer than expected, but I'm a buyer while the stock and the company are beat up.

I'm not expecting returns this year, or even next year, rather I'm accumulating GE in my Roth IRA.

Current bad times aside, I'm willing to bet that General Electric is going to be around for a long time and at these prices, I think that bet is worth it.

Disclosure: VFC is long GE.

Source: Why I'm Long General Electric