General Electric's Hidden Gem

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WG Investment Research


  • General Electric's Renewable Energy unit does not get enough attention because this business has promising long-term prospects.
  • The company comes with a lot of risk but I believe that GE's stock has almost bottomed. Does the biggest General Electric bear agree?
  • I recently reduced my General Electric position (sold 1/3 of my shares) but I plan to stay long the stock.

General Electric (NYSE:GE) is a company that is widely covered here on Seeking Alpha ("SA") and, as you can expect, there are people with strong opinions on both sides of the aisle. It has, however, been very easy to be a bear over the past three years as the company's stock price fell from the $30 range to under $15 per share.

ChartGE data by YCharts

Anyone that follows me on SA knows that I have been a GE bull for years, which unfortunately means that I have been wrong for years, but I still believe that there are reasons to own this industrial conglomerate.

Another SA author, Mr. Victor Dergunov, recently posted "GE: Undervalued By About $53 Billion" and, of course, the author's analysis/conclusion was criticized by the bears. While I do not agree with everything that Mr. Dergunov stated in his well-written article, I do believe that his overall takeaway was sound [i.e., GE still has some great (and valuable) businesses in its portfolio]. To this point, I will spend a few minutes covering a business that I believe is a real hidden gem, which is the Renewable Energy operating unit.

Playing The Long Game With Clean Energy - GE's Hidden Gem

Aviation and Healthcare get all of the attention when it comes to GE's operating units, and rightfully so, as both of these businesses have great growth profiles. But, let's not overlook the Renewable Energy business.

Before going any further, let's touch on one topic that I am sure many bears will hang their hats on, which is the fact that our president, Mr. Donald J. Trump, has consistently touted coal as a viable long-term energy source. As such, some pundits do not believe that renewable energy has a place in the U.S. but I personally think that that train has long left the station. To this

ChartGE PE Ratio (Forward) data by YCharts

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This article was written by

WG Investment Research profile picture
Our President and CIO is a CPA with experience in public accounting and the financial services industry. He earned his Master of Accountancy degree in 2008 and his B.S. in Business Management in 2007. He is also a Level III CFA candidate. He has been intrigued by the market from the start. Over the years, he has learned that long-term investing is a discipline that, if followed, will help contribute to building lasting wealth. As such, most of our articles will be about the investments that we plan to hold for at least 3 to 5 years, as long as the company's story does not change. As a Seeking Alpha contributor, our main goal is to write about the companies that are key to our portfolio with the hope of promoting discussion (for or against the investment) from others within the SA community.Please visit our website for more information about W.G. Investment Research LLC.

Disclosure: I am/we are long GE, BHGE, HON. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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