General Electric Company (GE): Investors Skeptical of the Big Transition

With the recent acquisition of power and grid division of the French energy firm Alstom SA (EPA:ALO) and plans to spin-off its credit card division to downsize the company’s financial arm, GE Capital, it’s clear that General Electric Company (NYSE:GE) is in the middle of a big transition.

Best Financial Services Companies to Work For

“Mr. Immelt is really accelerating the rate of change in the portfolio. With the three transactions that are going on, that’s going to change the composition of total revenues by over 15%,” Jack DeGan of Harbor Advisory Group said on CNBC’s Nightly Business Report.

The program focused on the effects the recent transitions will have on General Electric Company (NYSE:GE) and its shareholders.  After the Alstom SA (EPA:ALO) deal is complete, 75% of General Electric Company (NYSE:GE) earnings will be impacted by its industrial businesses by the end of 2016. It’s a large bet on Energy and Europe that is expected to increase to the earnings. General Electric Company (NYSE:GE) is also planning to raise $3.25 billion from the spin-off of its credit card unit in an IPO, later this year. For the investors all these transitions in different units of GE create a headwind for the stock in the near-term, especially till the Alstom SA (EPA:ALO) deal is finalized.

Speaking on the same program, David Seaburg of The Cowen Group that the stock of General Electric Company (NYSE:GE) is overvalued. Mr. Seaburg said: “I generally wouldn’t be a buyer in the stock at these levels. Plain and simple, there is too much risk from an execution perspective”

Art Hogan of Wunderlich Securities is more optimistic about the company’s future. According to him General Electric Company (NYSE:GE) expansions in the energy market were a mirroring of how the economy is shifting.

General Electric Company (NYSE:GE) came with its second quarter results on Friday. The earnings of the company increased by 13% to $3.55 billion, or 35 cents per share, from $3.13 billion, or 30 cents per share, in the same quarter a year ago. The Company’s oil & gas and aviation units grew their profits in the second quarter, while its healthcare business showed weak results as hospitals bought less medical equipment.

Disclosure: none

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Best Travel Destinations in Australia

World’s Most Expensive Musical Instruments

World’s Most Famous Animals

Most Expensive Cakes in the World

Most Expensive Kosher Champagne in the World

Most Expensive Kosher Wine in the World

The Most Surprisingly Dark Fairy Tales

Most Popular Travel Destinations in Asia

The 10 Most Expensive Dresses Ever Worn to the Oscars

World’s Most Visited Art Museums

Best Countries for Photographers to Work in

Best Paid Jobs in the Film Industry

The Most Renowned Recovered Paintings Ever

Child Stars That Turned out Just Fine

Books That Were Banned in the Past Century

World’s Richest Dancers

Best Remedies against Bad Breath

Foods That Improve Your Skin Texture

Best-Selling Children’s Books of all Time

Foods That Boost Your Libido

Best-Selling Books of all Time

The Most Expensive Academy Awards Jewelry in History

Most Expensive Japanese Restaurant In New York City

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

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 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!