GE's Results: The Market Hates 'Em, but I Love 'Em
I am not currently nor have I ever been a share holder of General Electric. However, one can often learn a lot about how other companies' earnings results will look by checking out the results of monster companies, like Walmart, GE, etc... The market obviously does not like the results of GE's first quarter, which it announced this morning. Its stock is down more than 11% in pre-market trading as I write this. I personally am not shocked that it had a rough quarter. GE has the United States' seventh largest financial company in its stable of businesses. Anyone who didn't know that financials had a rough Q1 has been living under a rock. I guess that Mr. Market doesn't like the fact that GE missed even though it usually does a good job at hitting estimates. Perhaps they should have pre-announced. Who knows. What I do know is that outside of financials, some of General Electric's other businesses are rocking.
I have been writing about and personally investing in infrastructure, particularly energy infrastructure a lot lately. In its press release GE said "Demand for our global Infrastructure business remained strong." During the Q1, GE's Infrastructure revenue rose 23% and its earnings for the segment rose 17%. If you drill down a little further, so to speak ;), within the infrastructure results, you can see that the company's oil and gas segment is doing great. GE's revenue for "Oil and Gas" section of its infrastructure unit rose 34% and its quarterly earnings rose 58%! About this subsegment, GE said "Oil & Gas, Energy, Transportation, and Aviation all generated double-digit profit growth – with no signs of slowing."
I don't know what the market will bring us with a lot of these companies today. Overall the futures are getting hammered right now. If companies that are involved in infrastructure, particularly energy infrastructure, like CBI, FLR, and MDR do fall today I personally believe that it will be an excellent buying opportunity.
GE's First Quarter Press Release
Long CBI, FLR, MDR
No position in GE