Split It All Up
With GE announcing it will spin out its oil and gas business, and its lighting business, having already divested its financial businesses, and with plans to divest its water and industrial solutions businesses, what’s left are a collection of power generation, aviation, additive manufacturing and healthcare businesses that appear to be performing well, but which are unrelated to one another, and no longer have the tie of finance to bind them.
Bulls call GE a “Super Jupiter”, a giant among pygmies it competes with, but shareholders get no benefit from its size. Immelt has a growing credibility gap between his promised future and his company’s performance.
Other InvestorPlace writers are divided on the company. Bret Kenwell says it will pick itself up again, and it could get a lift if energy prices rise. Tom Taulli suggests, as I do, that you ignore it, calling the whole outfit complicated and vague.
Which leads to my own modest proposal. Split the whole thing up. Give me a cloud company, a power company, a renewables outfit and a healthcare company. Let the healthcare outfit keep the Boston office and move the others far away from Jeff Immelt.
It’s time for GE as we know it to die.
Dana Blankenhorn is a financial and technology journalist. He is the author of the political polemic Saving Trumpistan, Restoring Democracy, available now at the Amazon Kindle store. Write him at email@example.com or follow him on Twitter at @danablankenhorn. As of this writing he owned no shares in companies mentioned in this story.