General Electric (GE) Dips More Than Broader Markets: What You Should Know
General Electric (GE) closed the most recent trading day at $64, moving -1.51% from the previous trading session. This change lagged the S&P 500's 0.65% loss on the day. Meanwhile, the Dow gained 0.12%, and the Nasdaq, a tech-heavy index, added 0.03%.
Coming into today, shares of the industrial conglomerate had lost 13.73% in the past month. In that same time, the Conglomerates sector lost 10.55%, while the S&P 500 lost 11.07%.
Investors will be hoping for strength from General Electric as it approaches its next earnings release, which is expected to be October 25, 2022. The company is expected to report EPS of $0.51, down 10.53% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $19.04 billion, up 3.29% from the year-ago period.
GE's full-year Zacks Consensus Estimates are calling for earnings of $2.74 per share and revenue of $75.89 billion. These results would represent year-over-year changes of +29.25% and +2.38%, respectively.
It is also important to note the recent changes to analyst estimates for General Electric. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. General Electric is currently sporting a Zacks Rank of #3 (Hold).
Investors should also note General Electric's current valuation metrics, including its Forward P/E ratio of 23.74. For comparison, its industry has an average Forward P/E of 14.53, which means General Electric is trading at a premium to the group.
Investors should also note that GE has a PEG ratio of 3.39 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Diversified Operations was holding an average PEG ratio of 1.55 at yesterday's closing price.
The Diversified Operations industry is part of the Conglomerates sector. This industry currently has a Zacks Industry Rank of 86, which puts it in the top 35% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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