General Electric Company (GE): Billionaires are Betting Big

United Technologies recently competed its purchase of Goodrich, which should prove to be a long-term positive for the company. This diversified tech products player also pays a dividend – yielding 2.7% – that is only a 35% payout of earnings. Even with the expected boost from the Goodrich acquisition, United Technologies’ expected long-term earnings growth rate comes in 10 percentage points below GE’s. United Technologies is still one of Dan Loeb’s big bets, though, so there’s some support from the smart money here (see all 5 here).

3M, meanwhile, appears to be one of the more expensive stocks in its industry. This tech-products company trades at 13.5x forward earnings and the highest P/S of the bunch at 2.2x. The company also has the lowest 5-year expected earnings growth rate of 10% (annually). Ray Dalio is one of the big-name investors owning 3M (check out Ray Dalio’s big bets).

Boeing trades the highest on a valuation basis with a 14.5x forward P/E and the lowest dividend yield at 2.4%. Although Boeing has solid expected long-term earnings growth – 5-year 12% CAGR – we remain cautious given its overweighting in the airline industry. The aerospace company also has the lowest EBITDA margin of the five stocks listed here, at 10%. Boeing had billionaire Jim Simons upping his stake by 170% last quarter, though, as stabilizing fuel prices can at least act as a decent near term tailwind (see Jim Simons’ other top picks here).

We agree with the likes of Warren Buffett and George Soros that GE is in its industry’s elite; one of GE’s top billionaire investors was George Soros, whose fund had 2.5% of its 13F invested last quarter (check out George Soros’ newest picks). GE also sports one of the top EBITDA margins in the industry at 25%, and between the company’s superb product diversity and strong international presence, there are plenty of reasons to be bullish.