GE meet but no beat

General Electric released results that were a meet, not a beat, at least on the bottom line, prior to the market opening on Friday. Revenue beat expectations (but were flat year on year), but EPS came in at 31 cents per share, understandably the markets were disappointed the stock sank nearly two percent, versus a market that was rocking. Here is the press release that will give you a little more insight -> GE Delivers $0.31 Operating EPS Excluding Effects of Preferred Redemption, Up 11%;
GE Reports Net EPS of $0.22, Up 22%; I guess that Jeff Immelt has got a point when he says that they were pleased to report a sixth consecutive quarter of double digit growth in this current environment. A record breaking order book.

GE Capital had quite a strong bounce back on flat comparative revenues, indicating that most of the stress has gone. Or is dissipating, most of that coming off an improvement in their real estate book, the losses were pared. What is a little disappointing however was a not so strong showing from the energy unit where margins were compressed as a direct result of the order book looking not as strong as before, plus there is also continued new competition. So perhaps such a large order book should be taken into context, not with the margins as before.

One other thing to bear in mind is that GE repaid Warren Buffett's Berkshire Hathaway, remember that fantastic arrangement for Buffett?

So what do you pay for a company of this size and scale? What do you pay for a company that has been around and morphed and changed, but always been the reliable one that you bought back then? Sure, the economy across the globe is slowing and people are paring back their own expectations, but I would venture to say that when the real growth comes back, perhaps not in the first half of next year, it would have been an opportunity missed already. The stock will be higher. For the time being the stock trades on a little over 13 times earnings and with a yield of around 3.7 percent. We continue to accumulate the stock, knowing that their time will come.