Will the Entrance of a New Activist Change Hedge Funds’ Mind about GE?

On the other hand, analyst are bullish on General Electric. One analyst has a ‘Strong Buy’ rating, five have a ‘Buy’ rating, one has a ‘Sell’ rating, and six have a ‘Hold’ rating. Credit Suisse has a ‘Focus List’ rating with a $31 price target. while Deutsche Bank has a ‘Hold’ rating with a $29 price target. Overall, analysts have a consensus price target of $28.70 per share, giving shares an upside of 13.80% from current levels.

We’re optimistic on General Electric. The company is focused on its strengths and discarding its non-core businesses. Renewable energy and industrial technology will always be in demand while financial lending could expose the company to systematic downsides. Given the huge stock repurchases on the horizon and the increased focus on cost cutting, we think General Electric should trade for higher than its current forward P/E of 16.55. The company’s dividend yield of 3.61% isn’t bad either. 

Disclosure: None