What Do the World’s Greatest Investors Think of This Metamorphizing Conglomerate

Like hedge funds, 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.

In this way we’re optimistic on General Electric. The company is focused on its core strength of innovative technology and carrying out its mission of ‘imagination at work’ rather than focusing on becoming a bigger shadow bank that takes advantage of its high credit rating. The former activity is sustainable and deserves a high valuation, while the latter can sink the company if another Great Recession comes. Given that General Electric is a safer company after divesting its financial operations, we think the stock deserves a higher valuation than its current forward PE of 16.4. With a dividend yield of 3.65% and substantial share repurchases on the horizon, we think General Electric is a good holding for any long term investor.

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