Research archive for GE

The company is synonymous with Thomas Edison, one of the greatest investors of the 19th century. The man was however funded for his electrical lighting experiments by none other than the Vanderbilt family and JP Morgan (the person, not the company), we have capital to thank for light bulbs, not political parties or organisations. People make things, people take chances on people and humans all win in the end. Of course the light bulb that Edison invented looks very different today, it is all about saving precious resources today. Using less power to make the same lighting choices. In 1896 the company became part of the Dow Jones Industrials index (only 12 in those days), and is the only remaining member. It hasn't always been there, it is however 120 years later, the only company left.

There have been two big announcements from GE in the preceding weeks;They are disposing most of GE Capital in the next 24 months and then they had their 2015 Q1 figures. The GE of late has always been a tale of two segments, industrials (for which they are known) and then GE Capital (which makes up the largest part of earnings). The share price jumped around 10% when they announced the sale of a large chunk of GE capitall, so the market likes the idea of moving to a more pure industrial play.

Last week we received fourth quarter and full year results from GE. I must say their investor presentations are great. I guess they have to be for such a complicated business with so many moving parts. Here is the presentation if you would like to have a look. Lots of images, graphs and tables to simplify things.

Given the all the earning figures that have been coming in over the last few weeks, we never gave you the breakdown of one of the bluest blue chips around, GE.

When you look up the term "Blue Chip" in the dictionary you get the GE share code as the definition. GE is a company that has been around since the late 1800s, and has none other than Thomas Edison as one of its founders. This is what Wikipedia had to say about the formation, "General Electric was formed by the 1892 merger of Edison General Electric Company of Schenectady, New York, and Thomson-Houston Electric Company of Lynn, Massachusetts..."

Alstom are reviewing the official GE offer. The GE announcement came this morning: GE offers $13.5 billion enterprise value to acquire Alstom Thermal, Renewables, and Grid businesses. What you have to remember again is that GE have 57 billion Dollars of their cash reserves abroad, in other words outside of the US. So even if they were successful for this bid of the power portion of the French company (that would be earnings accretive immediately), the same headache of repatriation of cash would remain. And surprisingly this would be the biggest ever, by one of the oldest and most trusted companies, General Electric.

There is M&A on a serious level starting to raise its head, last week we had the news that French industrial company, Alstom, is the target for both GE and now Siemens too. Alstom is a monster company, employing 93 thousand people globally in 100 odd countries (as per their website). A press release suggests that the company will make an announcement no later than the 30th of April. That is tomorrow. In the meantime, the company has requested for their shares to be suspended from trade. In other words you cannot transact in the shares, because the company is obviously subject to a suitor. Strangely the share price was higher in January than now, but the last five trading sessions (ending last Thursday, since then it has been suspended) Alstom is up nearly 24 percent.

On Friday we received Q4 results from GE which not only tells us a lot as investors in the stock but also tells us a lot about the economy in General. Here is their inspiring About GE explanation.

On Friday we received second quarter results from GE which beat expectations and sent the stock up 4.6%. This is the highest the stock has been since 2008 on the back of strong orders in the US and some stabilisation coming through from Europe. Let's look at the fundamentals and then see what they have to say about their operations. It is a massive industrial conglomerate so it is always very interesting see how their world looks when results are released.

On Friday we saw first quarter results from one of the most fascinating companies around, General Electric. Why are they so fascinating? We will go into the details later but first let us refresh our memories of where this massive conglomerate makes its money. This table below from their presentation shows where earnings came from in the first quarter.

This does not happen too often, but I guess the fact that a fair price has been reached and more importantly an overhang of sorts has been removed. I am talking about Comcast's purchase of the balance of NBC Universal for a whopping 16.7 billion Dollars. This announcement coincided with very good fourth quarter results from Comcast -> Comcast Q4 Profit Rises, Boosts Dividend By 20%; To Repurchase $2.0 Bln Of Stock.

The very first headline I saw which covered GE's 4th quarter results which came out on Friday looked like this from The FT. GE lifted by strong emerging markets growth. I sense a pattern here. To get a better idea of how the big conglomerate is made up in terms of revenue and profit I hacked this table from their 4th quarter presentation.

On Friday we received third quarter numbers from one of our biggest holdings in New York, the massive conglomerate General Electric. This company who has businesses all over the world breaks up their interests into two main categories, Infrastructure and Finance. Infrastructure includes GE's involvement in manufacturing equipment for energy, health, transportation and technology. The finance division works like a bank with a more focused structure helping GE as a whole capitalise on market specific opportunities, according to their website.

It is difficult to figure out when the company was actually founded, but the General Electric timeline on Wiki suggests 1890. In 120 years the business has become perhaps one of the most iconic company names on the planet. These were results for the second quarter of 2012, and the media release is available here: GE Reports 2Q'12 Operating EPS $0.38 +12%. The heading is actually a great summary of how the business is looking:

One of the smaller share prices in the Dow Jones and a widely owned stock, General Electric reported numbers on Friday pre the market opening. I love earnings season. After the dust had settled, GE actually closed flat at 19.15. The presentation can be found here -> GE 2011 fourth quarter performance.