Double-dip: GE buys Cameron unit, Citi removes from Focus List

Investors didn't seem too thrilled with GE's $550M purchase yesterday of Cameron's (CAM) reciprocating compression division, sending GE shares more than 1% lower today.

For CAM, Sterne Agee views the asset sale (and likely additional sales) as positive but believes execution of its core businesses will be the key to success in 2014; while asset sales could prompt some modest downside to its 2014-15 EPS estimates of $3.90 and $5.00, the firm sees CAM's aggressive approach to buying back stock in Q4 indicating confidence in its operations and execution.

Citigroup removes GE from its Focus List, not because of the purchase but due to its earnings: GE unexpectedly fell 10 bps short of its 2013 target of 70 bps of operating margin growth, normally not a big deal "but since GE does not provide EPS guidance, this target had become a disproportionally key 2013 milestone in GE’s road to a transformational mix of 70/30 industrial/capital."

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Comments (6)
  • 11093511
    , contributor
    Comments (11) | Send Message
    GE is one of the great industrial companies in the world. These so called analysts are just plain crazy.
    21 Jan 2014, 07:56 PM Reply Like
  • rcpatrick5443
    , contributor
    Comments (900) | Send Message
    It must have been a slow news day for Sterne Agee to produce such conceptual and linguistic drivel.
    21 Jan 2014, 09:24 PM Reply Like
  • JojoPa
    , contributor
    Comments (19) | Send Message
    Yeah, must have been slow, the miss was 4 basis points... not 10.
    21 Jan 2014, 10:15 PM Reply Like
  • manfredthree
    , contributor
    Comments (3155) | Send Message
    Seems like worse news for Sterne Agee than for GE ! Hello !
    21 Jan 2014, 10:36 PM Reply Like
  • Bmgue12
    , contributor
    Comments (102) | Send Message
    I was starting to feel good about GE. I own shares since it was over $100, lost a lot and Ismael has not doing much for GE. I am disappointed. I do hope I am wrong.
    22 Jan 2014, 08:03 AM Reply Like
  • rubel
    , contributor
    Comments (621) | Send Message
    ge will not get back on track until immelt is sacked along with the board!
    22 Jan 2014, 12:14 PM Reply Like
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