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General Electric Company (GE) Looks Poised For a Bounce Back

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General Electric Company (GE)General Electric Company (NYSE:GE) is a highly diversified technology and financial services corporation, with its offerings ranging from aircraft engines, water processing, power generation, and household appliances to medical imaging, business and consumer financing and industrial products.

General Electric increased by about 22% in 2012. It outperformed the S&P 500 with strong performance of its stock in the month of September. NBC Universal exited the long-running conglomerate’s portfolio of businesses, but GE still expanded its business interests, which includes energy infrastructure, aviation, healthcare, and finance. Like many other conglomerates, GE is also betting big on emerging markets. GE expects growth from the rapid-growing economies of Asia-Pacific and Latin America, along with the boosted  industrialization of resource-rich middle-east, North Africa, and Russia.

Encouraging Financials

General Electric posted higher fourth quarter 2012 operating earnings of $4.67 billion, compared to $4.14 billion or $0.39 per share in the previous year of 2011. The net earnings attributable to GE common shareowners increased to $4.01 billion, or $0.38 per share, as against last year’s $3.73 billion, or $0.35 per share. The GAAP earnings from continuing operations were recorded at $4.3 billion, or $0.41 per share.

Quarterly revenues and other income came in at $39.33 billion, a 4% growth from $37.97 billion a year earlier, with industrial segment organic revenue growth of 4% for the quarter.

Competitors

The nearest competitors of General Electric Company (NYSE:GE) are Siemens, DuPont, Honeywell and Danaher. General Electric is a huge company compared to any of these with a market capitalization of $222 billion. The market capitalization of Siemens is $95.1billion; DuPont has $43.1 billion worth of market capitalization.

Siemens AG has been a close rival of GE. The company has performed exceptionally well over the previous years. It has also given steady returns to investors.  Siemens AG Capital Market Day was organized in London, in which acknowledged financial analysts talked about the company’s impressive performance in the first fiscal quarter of 2012. The future plans of the company were also discussed in detail, most importantly regarding the innovations in the healthcare sector. Siemens looks forward to devise wide ranging plans and strategies to enhance its share in the global market. In the last year alone, Siemens has recorded an impressive income growth of a 67% while sales and revenues have also grown significantly.

DuPont (DD) posted earnings for the fourth quarter that were above estimates. Net sales for the company were almost at $7.325 billion. The company is giving strong performance in agriculture and food businesses, despite unfavorable currency exchange movements. For 2013, the company expects a robust performance with strong growth in crop protection driven by new products.

2013 update

The company pulled down its outlook for GE capital earning growth in 2013 to a single digit. The outlook of 2013 also comprises of $0.3 billion of restructuring in excess of gains.

Mining

This segment was one of the hot topics in 2012, when GE acquired Industrea and Fairchild. The GE penetrated through subsurface mining equipment segment through this acquisition. The management is seeking to build this business organically. The company is following the strategy of patience with this business segment.

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