Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

General Electric Company (GE) Growth Car is Driven By Oil & Gas

The fuel that General Electric Company (NYSE:GE)‘s growth has been driving on is as obvious as it sounds, provided by its Oil & Gas division. CNBC‘s Mary Thompson tried to unlock the secret edge that the company has over its competitors in an interview with GE Oil & Gas’ CEO, Lorenzo Simonelli.

Best Financial Services Companies to Work For

“If you look at the blades, the carbon fibres, we are able to take that light weight material knowledge, bring it into the aspect of oil and gas. You look at the power and water, the capabilities on the turbines, bringing that into oil and gas […],” said Simonelli.

The business model is simple. General Electric Company (NYSE:GE)’s Oil & Gas division is essentially harnessing technologies from its other businesses like Electronics and Healthcare to give it an edge against long established competitors such as Cameron International Corporation (NYSE:CAM) and Schlumberger Limited. (NYSE:SLB).

Apart from the innovations mentioned above by Simonelli, they also include analytics in form of software that General Electric Company (NYSE:GE) provides its customers for scheduling and production purposes, and also diagnostics and monitoring services, technology from its health care division, to help their customers reduce unplanned downtime.

The second distinguishing feature of his division’s business model, according to Simonelli, is to stay close to their customers in the focus areas. Oil & Gas discoveries are mostly located in politically unstable countries. By keeping abreast of the political arena and close regular contact with their customers General Electric Company (NYSE:GE) has minimised these political risks.

Thompson reported that during 2009-2013 General Electric Company (NYSE:GE)’s Oil & Gas division has seen a 75% growth in revenue, which also means that the division was responsible for 43% of they company’s top line growth. The department’s $17 billion revenue for 2013 amassed 11% of General Electric Company (NYSE:GE)’s total revenue. Simonelli expects his division to outperform the 6% growth forecast for the industry.

Disclosure: none

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!