General Electric Company (GE)

NicieNicie (86.60) Submitted: 9/06/07 1:57 PM : Start Price: $36.57 GE Score: -17.35

As correctly noted above, GE is a multinational: according to a recent FORBES report earnings are split 50/50 int'l vs. USA. Therefore in the future we can expect GE not to mirror the S&P as closely as before. (Note that by their size, more than a couple of big firms ride the ups and downs of the S&P and/or DJIA: XOM for example.)


Having said that, GE seems to be a touch faster off the mark in areas in which it already has a market. Over the past fifteen years or so, the company went from electric stuff (bulbs, etc. and industrial uses) and primarily heavy durables (washing machines, etc.) to consumer finance. It is now trending away from consumer finance, having sold its credit-bureau business two years ago. There is still enough of a domestic finance component that GE stands in danger of any upstream freeze of credit liquidity emanating from the subprime mortgage mkt. No more than any other bank or financier, in general, though, and since GE has so many areas of core competence it has a tendency not to panic when times get bad in one of them. So, pluck the Peacock: I rate GE an outperform and a long-term hold.

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