Friday, July 20, 2018

What to Expect When GE Reports

General Electric Co. (NYSE: GE) is scheduled to release its second-quarter financial results before the markets open on Friday. The consensus estimates of $0.18 in earnings per share (EPS) and $29.31 billion in revenue compare with the $0.28 per share and $29.56 billion posted in the same period of last year.

In late June, the company announced its plan to focus on its Power, Aviation, Renewable Energy and GE Capital businesses while it sells or spins off its Healthcare, Oil & Gas, Transportation and Lighting businesses. Based on 2017 revenues, GE��s plan chops about $40 billion in sales from a total of around $125 billion.

GE already has shed its Distributed Power, Industrial Solutions and Value-Based Care divisions, and it has agreed to combine its Transportation business with Wabtec in a new company. These deals have substantially achieved CEO John Flannery��s promise to divest $20 billion in assets.

The company also plans to spin off its Healthcare business and to separate Baker Hughes over the next two or three years. The Lighting business already has been pared down, and the company had no more to say about its fate although it has been seeking a buyer for more than a year.

Over the course of the past 52 weeks, GE has underperformed the broad markets, with the stock down about 49%. In just 2018 alone, the stock is down 21%.

A few analysts weighed in on GE ahead of the report:

Gabelli has a Buy rating. JPMorgan has a Sell rating with an $11 price target. Deutsche Bank has a Hold rating and a $15 price target. Barclays has a Neutral rating with a $16 price target. Citigroup has a Buy rating with a $21 price target. Goldman Sachs has a Neutral rating with a $14 target. Oppenheimer has a Market Perform rating.

Shares of GE were last seen trading at $13.65, with a consensus analyst price target of $17.21 and a 52-week trading range of $12.61 to $27.05.

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