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Analysis of General Electric (#GE)

Analysis of General Electric (#GE)

23 June 2021

General Electric is an American diversified corporation, a manufacturer of many types of equipment, including locomotives, power plants (including nuclear reactors), gas turbines, aircraft engines, medical equipment, photographic equipment, household and lighting equipment, plastics and sealants, as well as a wide range of military products, from small arms and armored vehicles to military space systems and nuclear warheads. About a fifth of the revenue from the sale of products and services is made up of military orders from the US federal authorities. At the moment, the company operates in 5 areas: energy, aviation, oil and gas, healthcare and finance.

The company’s main competitors are Siemens AG and Honeywell International Inc.

Revenue for the last quarter: $17.1 B (-16% compared to the same period of the previous year)

Operating income for the last quarter: $574M (-49% compared to the same period of the previous year)

Net loss for the last quarter: $2.9 B

Distribution of revenue by business segment:

Aviation – 27.36%

Healthcare – 22.36%

Power – 21.84%

Renewable Energy – 19.45%

GE Capital – 8.99%

Despite the fact that the financial performance in the previous quarter was not as good as a year ago, #GE does not cease to be attractive to potential investors. One of the company’s strengths is the high degree of diversification among business segments, which allows the company to be relatively stable during crises. Another advantage is the constant demand from the United States.

Thus, General Electric is a mature company with high diversification among business segments. Moreover, the company’s management is increasingly focusing on renewable energy, which can improve the company’s financial performance in the future. Right now, however, the #GE share price looks high enough to buy.

23 June 2021
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