General Electric (GE) is known for its innovation in everything from home appliances to jet engines. Earlier this year, GE announced its partnership with Local Motors, which just revealed the first 3-D printed car.
General Electric logo
GE is always looking ahead when it comes to new technology, but how does it fare as an investment?
Company Profile
For the past 125 years, General Electric has exemplified American ingenuity. Throughout the years, GE has been responsible for inventing the fluorescent lamp, the dishwasher, the toaster oven, the MRI and the first U.S. jet engine.
However, even though General Electric is best known for its consumer electronics and appliances as well as industrial machinery, GE also has businesses branching into media, healthcare, transportation and finance. Operating in over 100 countries, GE currently employs 305,000 people worldwide and is the 17th largest business in the world in terms of sales.
Portfolio Strategy
Not too long ago, General Electric made the decision to refocus its business strategy to redistribute capital to non-core assets. You’ll notice this strategy coming into play with GE’s recent agreement to sell its GE Appliances division to Electrolux — pending approval in 2015. GE is set to gain between $0.05 and $0.07 per share at the closing of this deal.
According to a press release, the agreement is a move by GE to focus further on infrastructure and technology, as well as restructuring its portfolio. Jeff Immelt, GE Chairman and CEO, said, “We are creating a new type of industrial company, one with a balanced, competitively positioned portfolio of infrastructure businesses.”
Current Ratings
While GE is clearly working to reshape its portfolio and overall business plan, its buying pressure and metrics are not looking very strong.
First, GE is lackluster at best in terms of its fundamentals. Out of the eight metrics I screened GE on, seven score “Cs” and “Ds.” The only solid grade GE scored was a “B-grade” on return on equity. Also, GE stock hasn’t been able to drum up adequate buying pressure. So, GE receives a “D” for its Quantitative Grade and is firmly a “D-rated” stock.
As of this posting, September 22, 2014, GE is a “D-rated sell.”
Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.
