GENERAL ELECTRIC NYSE-GE
TIMELINESS
SAFETY
TECHNICAL
3
3
2
High:
Low:
Raised 12/4/15
37.8
28.9
RECENT
PRICE
37.3
32.7
38.5
32.1
42.2
33.9
22.6 RELATIVE
DIV’D
Median: 15.0) P/E RATIO 1.27 YLD 3.0%
30.74 P/ERATIO 22.0(Trailing:
38.5
12.6
17.5
5.7
19.7
13.8
21.7
14.0
23.2
18.0
28.1
20.7
27.9
23.7
31.5
19.4
Target Price Range
2018 2019 2020
LEGENDS
10.5 x ″Cash Flow″ p sh
. . . . Relative Price Strength
Options: Yes
Shaded area indicates recession
Lowered 3/13/09
Raised 1/8/16
BETA 1.15 (1.00 = Market)
VALUE
LINE
80
60
50
40
30
25
20
15
2018-20 PROJECTIONS
Ann’l Total
Price
Gain
Return
High
50 (+65%) 15%
Low
30
(Nil)
3%
Insider Decisions
to Buy
Options
to Sell
F
1
0
0
M
0
0
0
A
4
0
0
M
0
0
0
J
0
0
0
J
0
0
0
A
0
0
0
S
0
0
0
O
0
1
0
% TOT. RETURN 12/15
Institutional Decisions
1Q2015
2Q2015
3Q2015
921
819
859
to Buy
to Sell
925
1003
944
Hld’s(000)554450456132125750766
Percent
shares
traded
12
8
4
1 yr.
3 yr.
5 yr.
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
11.33 13.07 12.69 13.21
1.77
2.06
2.14
2.12
1.07
1.29
1.41
1.51
.49
.57
.64
.73
.21
.26
.29
.24
4.32
5.08
5.52
6.39
9854.5 9932.0 9925.9 9969.9
35.9
40.1
30.8
20.7
2.05
2.61
1.58
1.13
1.3%
1.1%
1.5%
2.3%
13.33
2.24
1.55
.77
.97
7.87
10063
18.1
1.03
2.7%
14.44
2.38
1.61
.82
1.24
10.47
10586
20.5
1.08
2.5%
14.28
2.56
1.72
.91
1.38
10.43
10484
20.5
1.09
2.6%
149702
30.6%
8538.0
18275
(61% of Cap’l)
17.4%
Leases, Uncapitalized $900 mill.
Pension Assets-12/14 $60.7 bill.
12.2%
Obligation $86.3 bill. 184959
Pfd. Stock None
212281
109354
Pfd. Div’d None
7.1%
Common Stock 10,109,239,000 shares
16.7%
MARKET CAP: $311 billion (Large Cap)
8.2%
CURRENT POSITION 2013
2014 9/30/15
51%
CAPITAL STRUCTURE as of 9/30/15
Total Debt $226.5 bill. Due in 5 Yrs $160.0 bill.
LT Debt $180.0 bill.
LT Interest $10.0 bill.
($MILL.)
Cash Assets
Receivables
Inventory (LIFO)
Other
Current Assets
Accts Payable
Debt Due
Other
Current Liab.
15.90 17.30
2.90
3.28
1.99
2.20
1.03
1.15
1.62
1.79
10.93 11.57
10277 9987.6
17.3
17.2
.93
.91
3.0%
3.0%
163391
32.5%
9158.0
20666
16.1%
12.6%
235281
260804
112314
6.7%
18.4%
9.1%
50%
172738
35.1%
10278
22468
15.5%
13.0%
244405
319015
115559
6.4%
19.4%
9.5%
51%
THIS
STOCK
VL ARITH.*
INDEX
27.5
62.8
99.9
-6.9
37.7
52.1
© VALUE LINE PUB. LLC
10
7.5
18-20
17.32
2.81
1.78
1.24
1.52
9.93
10537
15.7
.94
4.4%
14.70
2.07
1.03
.61
.81
11.00
10663
13.0
.87
4.6%
14.15
2.13
1.15
.46
.92
11.20
10615
14.4
.92
2.8%
13.93
2.28
1.31
.61
1.20
11.01
10573
13.9
.87
3.4%
14.16
2.44
1.52
.70
1.45
11.82
10406
13.3
.85
3.5%
14.52
2.65
1.64
.79
1.34
12.98
10061
14.7
.83
3.3%
14.77
2.59
1.65
.89
1.36
12.74
10057
15.7
.83
3.4%
12.40
2.15
1.30
.92
1.30
11.40
10100
20.6
1.04
3.4%
12.80
2.35
1.50
1.00
1.35
12.20
10100
Revenues per sh
‘‘Cash Flow’’ per sh
Earnings per sh B
Div’ds Decl’d per sh C■
Cap’l Spending per sh
Book Value per sh D
Common Shs Outst’g E
Avg Ann’l P/E Ratio
Relative P/E Ratio
Avg Ann’l Div’d Yield
16.00
3.70
2.70
1.40
1.50
15.50
10000
15.0
.95
3.5%
182515
31.1%
11492
18089
5.5%
9.9%
254715
330067
104665
5.6%
17.3%
5.4%
69%
156783
25.4%
10636
11434
-7.3%
316579
338215
117291
4.6%
9.7%
2.1%
79%
150211
26.8%
10013
12623
7.4%
8.4%
314972
360681
118936
3.9%
10.6%
6.6%
38%
147300
30.3%
9185.0
14880
27.4%
10.1%
272131
315832
116438
4.8%
12.8%
7.2%
43%
147359
27.7%
9346.0
16065
14.4%
10.9%
283910
312668
123026
4.8%
13.1%
7.2%
45%
146045
26.5%
9762.0
16882
8.5%
11.6%
245855
251789
130566
5.6%
12.9%
6.9%
46%
148589
25.3%
9283.0
16723
10.3%
11.3%
234450
230352
128159
5.9%
13.0%
6.1%
53%
125000
25.1%
9000
12870
22.0%
10.3%
175000
175000
115000
6.0%
11.0%
3.0%
71%
129250
26.5%
8500
15150
22.0%
11.7%
180000
170000
123000
7.0%
12.5%
4.0%
67%
Revenues ($mill)
Operating Margin A
Depreciation ($mill)
Net Profit ($mill)
Income Tax Rate
Net Profit Margin
Working Cap’l ($mill)
Long-Term Debt ($mill)
Shr. Equity ($mill) D
Return on Total Cap’l
Return on Shr. Equity
Retained to Com Eq
All Div’ds to Net Prof
160000
29.2%
10000
27000
25.0%
16.9%
219500
157000
155000
10.0%
17.5%
8.5%
52%
BUSINESS: General Electric Company is one of the largest & most
diversified technology and financial services companies in the
world. With products ranging from aircraft engines, power generation, oil and gas production equip., and household appliances (in
the process of being sold) to medical imaging, business and consumer financing, and industrial products, it competes for customers
in 175 countries. 2014 R&D outlays: $4.2 billion, 3.1% of revenues;
2014 international sales: $77.3 billion, 52% of top line. Employs approx. 305,000. Officers & directors own less than 1% of common
stock; BlackRock and Vanguard, 5.0% (3/15 Proxy). Chairman &
CEO: Jeffrey Immelt. Inc.: NY. Address: 3135 Easton Turnpike,
Fairfield, CT 06828. Tel.: 203-373-2211. Internet: www.ge.com.
General Electric shares have broken
through the $30-a-share barrier. Over
ANNUAL RATES Past
Past Est’d ’12-’14 the last few years, GE would gain some
of change (per sh)
10 Yrs.
5 Yrs.
to ’18-’20
traction in its turnaround and rise only to
Revenues
0.5%
-2.5%
1.5%
be undone by some unfavorable develop‘‘Cash Flow’’
1.5%
-1.0%
6.5%
Earnings
0.5%
-1.0%
9.0%
ment. However, now that CEO Jeffrey ImDividends
0.5%
-4.5% 10.0%
melt has chartered a quicker course for
Book Value
4.5%
3.0%
3.5%
the GE Capital unwinding, and highQUARTERLY REVENUES ($ mill.) F
CalFull profile investors (Nelson Peltz) are on
endar Mar.31 Jun.30 Sep.30 Dec.31 Year board, this stock’s trajectory has been up2012 35182 36501 36349 39327 147359 ward. It is amazing what some positive
2013 34815 35123 35725 40382 146045 press can do for a bewildered selection. So,
2014 34178 36233 36174 42004 148589 in a year when the broader Dow Jones In2015 29356 32754 31680 31210 125000
2016 29250 32000 32000 36000 129250 dustrial Average finished in the red, GE
stock was one of its top performers.
EARNINGS PER SHARE B
CalFull Fundamentals will likely remain on
endar Mar.31 Jun.30 Sep.30 Dec.31 Year
the peripheral for the near term. Our
2012
.34
.38
.36
.44
1.52 earnings calls remain basically static;
2013
.39
.36
.36
.53
1.64 share net of $1.30 in 2015 followed by a
2014
.33
.39
.38
.56
1.65
2015
.20
.31
.29
.50
1.30 jump to $1.50 this year. Revenue calls, on
2016
.26
.35
.33
.56
1.50 the other hand, continue to decline as
pieces of the old General Electric are
C■
QUARTERLY
DIVIDENDS
PAID
CalFull eliminated from the portfolio, and its
endar Mar.31 Jun.30 Sep.30 Dec.31 Year
transformation into a true industrial con2012 .17
.17
.17
.17
.68 glomerate enters the late stages. That
2013 .19
.19
.19
.19
.76 said, investors are advised not to harp on
2014 .22
.22
.22
.22
.88 the actual numbers coming in, but the
2015 .23
.23
.23
.23
.92
progress being made in the asset altera2016
tion process. By the end of this year, we
should have a significantly clearer picture
of exactly where GE will be heading in the
next decade and beyond.
Portfolio flux will undoubtedly continue in 2016. Large divisions of the finance arm have been sold to Wells Fargo
and Blackstone Group, and more deals of
this nature are coming. Too, it is important to realize that this is not a firesale.
True, GE Capital divestitures are coming
in at a fast clip, but additions to industrial
units are also being made. The high-profile
addition of Alstom’s energy unit gets most
of the headlines. More recently, Metem, a
turbine efficiency entity, was acquired as
well. Separately, the sale of the appliance
arm to Electrolux has fallen through due
to Justice Department’s concerns. We look
for this situation to be revisited, likely
with a new partner, in the coming year.
For now, the dividend remains this
equity’s top draw. Appreciation should
be slow as changes continue. GE’s yield,
which is still 3%, will reward the patience
shown by those awaiting a full-fledged
resurgence.
Erik M. Manning
January 15, 2016
132536
272442
17325
-422303
16471
77890
82087
176448
138115 136019
257148 100955
17689 19285
--412952 256259
16338 11762
71789 46495
27536 26195
115663 84452
(A) Operating margin includes all expenses except interest, depr., and taxes. (B) Diluted
EPS. Excludes nonrecuring/discontinued
items: ’02, 10¢; ’05, (18¢); ’06, 1¢; ’07, (3¢);
’08, (6¢); ’09, (2¢); ’10, (9¢); ’11, (7¢). Quarter- able. (D) Includes intangibles. In ’14: $98.0 billy EPS may not sum due to rounding. Next egs. lion, $9.74/share. (E) In millions. (F) Revenues
may not sum, as reported.
report due January 22nd. (C) Divs. paid late
January, April, July, and October. ■ DRIP avail-
© 2016 Value Line, Inc. All rights reserved. Factual material is obtained from sources believed to be reliable and is provided without warranties of any kind.
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Company’s Financial Strength
Stock’s Price Stability
Price Growth Persistence
Earnings Predictability
B++
80
20
70
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