General Electric (NSDAQ:GE) - Is GE a STRONG BUY?

27 dic 2022

GE

The US-based General Electric (GE for short) is one of the largest conglomerates in the world. Since 2016, its headquarters have been located in Boston, Massachusetts. Around 174,000 employees work for the company in over 170 countries. The company produces a wide range of products that are in demand in industry, medicine and aircraft construction.

Operationally, the Group is divided into five business units:

• Aviation
  
• Healthcare
  
• Power
  
• Renewable Energy
  
• Capital
  

GE has been plagued by the issues that come with industrial giants for a very long time. Large, centralized businesses frequently struggle with insufficient flexibility, excessive bureaucracy, and a lack of entrepreneurial independence for the various departments.

Then-CEO John Flannery revealed a new approach to stay competitive. Three business units within GE were to be spun off in order to reduce its size, with GE concentrating on its aviation, energy, and renewable energy businesses. Flannery's time in office ended up being incredibly brief. He was fired by the board unanimously a year after being named CEO. Lawrence Culp assumed control of his position, and the previous leader's objectives were altered. Although the method of streamlining was altered, the end result remained the same.

In the future, GE therefore targets to focus on the business units aviation, healthcare as well as renewable energy, power and digital combined as one group. Now that the spin-offs have given each company sector more entrepreneurial flexibility, the question is how those business areas will evolve. At the same time, debt reduction at GE is ongoing.

Is GE a strong BUY?

Tradingview reports that 13 out of 22 analysts rate it as a "strong buy", two analysts rate GE as a "buy", and the remaining seven analysts rate it as a "hold" with a maximum estimate of USD 107.00 and a minimum estimate of USD 72.00. The current GE stock price is USD 81.79.

The predicted EPS for Q4-2022 is expected to rise by 26% from the reported EPS from the previous quarter. Analysts predict that the EPS will rise annually by close to 50% when compared to the reported EPS from 2021.

According to predictions, income will drop somewhat in 2022 compared to 2021, by about 0.55%. However, the analysts predict that sales may rise in the years to come.