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General Electric (GE -1.2%) may look attractive on the surface, with its industrial and capital...

General Electric (GE -1.2%) may look attractive on the surface, with its industrial and capital services units both poised for cyclical gains should the economy kick into gear. However, the mega-conglomerate is a unique financial-industrial hybrid, says Morgan Stanley's Nigel Coe, and if you back out GE Capital from the numbers, you'll find that both units are actually trading at a large premium to comps., and with a little pricing competition, the company could face serious headwinds.
Comments (9)
  • I view GE as a buy at $17 or below. My most recent purchase was back in September at just a hair over $15. I'm not in a particular hurry to buy more, but will do so if the next market correction brings it down to my buy range.
    16 Jul 2012, 03:32 PM Reply Like
  • Powerful companies face the headwinds and blow back.

     

    Less potent ones get blown away.

     

    I've heard that the CEO of GE is a blowhard, so I'm not worried.
    16 Jul 2012, 03:34 PM Reply Like
  • GE has a significant business with BA supplying engines for new planes. I don't see anyone overhelming BA in this segment!. Once GE capital gets approval to give dividend this fall, stock will bounce and will yield over 4% at current levels.
    16 Jul 2012, 03:42 PM Reply Like
  • They already have announced that GE capital profits will be used for buying back shares.
    16 Jul 2012, 04:52 PM Reply Like
  • GE has been "managing" their earnings and analysts expectations for 2 decades now. They are a former bull market darling that still rely heavily on their finance units. They are over owned by Wall Street and the stock is nothing more than a money making trading vehicle for the Wall Street smart money aka: con artists. The Wall Street shills will tout this stock and company (like all the other 30 most mentioned companies) as the "buy of the decade" and continue to pass that off as "ground breaking" investment research.

     

    There are so many more worth while investments out there.
    16 Jul 2012, 03:51 PM Reply Like
  • The financial crisis has revealed Jack Welch's stupidity in turning a champion industrial company into a GE Capital-dominated monstrosity. Until Immelt creates a more balanced company by divesting more of GE Capital, troubles emanating from the financial sector will continue to punch GE investors right in the gut.
    16 Jul 2012, 03:58 PM Reply Like
  • Well put, citizenleung and Archman.
    17 Jul 2012, 01:44 AM Reply Like
  • GE stock owner for the last 3 years
    17 Jul 2012, 02:10 AM Reply Like
  • It is a giant as a company but it fails to fire on all cylinders investors hoping that it will sell some asset and than improve its earning until that time the stock will trade between 16- -21 dollars
    17 Jul 2012, 02:13 AM Reply Like
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