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General Electric (GE) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3 min read

General Electric (GE) closed at $10.61 in the latest trading session, marking a -1.49% move from the prior day. This move lagged the S&P 500's daily loss of 0.21%. At the same time, the Dow lost 0.67%, and the tech-heavy Nasdaq gained 0.51%.

Prior to today's trading, shares of the industrial conglomerate had gained 6.95% over the past month. This has outpaced the Conglomerates sector's gain of 3.71% and the S&P 500's gain of 4% in that time.

Investors will be hoping for strength from GE as it approaches its next earnings release. The company is expected to report EPS of $0.08, down 61.9% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $21.11 billion, down 19.56% from the year-ago period.

GE's full-year Zacks Consensus Estimates are calling for earnings of $0.04 per share and revenue of $79.32 billion. These results would represent year-over-year changes of -93.85% and -24.97%, respectively.

Investors might also notice recent changes to analyst estimates for GE. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 11.54% higher. GE is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note GE's current valuation metrics, including its Forward P/E ratio of 259.97. This represents a premium compared to its industry's average Forward P/E of 20.16.

It is also worth noting that GE currently has a PEG ratio of 61.17. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Diversified Operations was holding an average PEG ratio of 2.16 at yesterday's closing price.

The Diversified Operations industry is part of the Conglomerates sector. This industry currently has a Zacks Industry Rank of 184, which puts it in the bottom 28% 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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