General Electric (GE) is one of the oldest companies currently publicly traded. But, despite being more than 130 years old, the saying that “you can’t teach an old dog new tricks” doesn’t apply here.
As the company finally nears the end of its multi-year turnaround, things are looking positive. In fact, the stock has climbed more than 100% in the last year. Just in 2023 alone, GE is up 72% with no signs of slowing down.
Much of this can be attributed to management’s focus on cash flow, cleaning the balance sheet, selling off assets, and chiseling away debt. The company’s overarching goal during this transitionary period has been to become a more agile, slimmed-down version of what it once was – dedicating a new level of attention to aerospace.
Just last week, the company delivered earnings that exceeded the consensus and left analysts excited for the future by boosting guidance. In fact, just through the 2nd quarter so far this year the company has outperformed the full year of 2022.
Profit is soaring, and after 5 years of digging through the trenches, CEO Larry Culp is finally seeing his vision come to fruition. When he took over the company, the debt and obligations were weighing the company down. Culp was tasked with cleaning up the mess the previous CEO Jack Welch left him.
But today, with about $100b less in debt, the company is poised to step into the future with 3 distinct businesses: aviation, healthcare, and energy. With the majority of analysts holding a buy rating on this stock, it’s time to stop doubting.
Can the company really compete with the likes of Boeing, though? And, more specifically, does it belong in your portfolio? We’ve taken a look at GE through the VectorVest stock analysis software and have 3 things you need to see before you trade this stock.
GE Has Fair Safety, Good Timing, and Very Good Upside Potential
The VectorVest system simplifies your approach to trading by giving you clear, actionable insights in just 3 ratings: relative value (RV), relative safety (RS), and relative timing (RT).
Each of these sits on an easy-to-interpret scale of 0.00-2.00, with 1.00 being the average. This makes it easier than ever to analyze an opportunity and feel more confident trading. But, it gets even easier. Because based on the overall VST rating, the system issues a clear buy, sell, or hold recommendation for any given stock, at any given time. As for GE, here’s what we found…
- Very Good Upside Potential: One analyst says that after the recent stock split for GE, shares have a lot of room to grow. And based on the very good RV rating of 1.25, this is a fair assessment. This rating is a comparison between a stock’s long-term price appreciation potential (forecasted 3 years out) and AAA corporate bond rates & risk.
- Fair Safety: In terms of risk, GE is a fairly safe stock - with an RS rating of 1.07. This is calculated through a deep analysis of the company’s financial consistency & predictability, debt-to-equity ratio, and business longevity.
- Good Timing: As you can see by looking at the price trend for GE, things are looking up - and the good RT rating of 1.12 reflects that. It’s based on the direction, dynamics, and magnitude of the stock’s price movement. It’s taken day over day, week over week, quarter over quarter, and year over year.
The overall VST rating of 1.14 is considered good - is it enough to earn a buy, though? Or, is there any reason to hold out and await further confirmation?
You don’t have to play the guessing game or let emotion influence your decision-making. Get a clear recommendation on your next move through the free stock analysis awaiting you at VectorVest.
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VectorVest advocates buying safe, undervalued stocks, rising in price. There’s no denying the surging turnaround for GE right now. The stock has fair safety, good timing, and very good upside potential.
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