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General Electric (GE) Outpaces Stock Market Gains: What You Should Know

·3 min read

General Electric (GE) closed the most recent trading day at $73.58, moving +1.97% from the previous trading session. This move outpaced the S&P 500's daily gain of 1.83%. Meanwhile, the Dow gained 1.4%, and the Nasdaq, a tech-heavy index, added 0.09%.

Heading into today, shares of the industrial conglomerate had lost 3.7% over the past month, outpacing the Conglomerates sector's loss of 6.83% and the S&P 500's loss of 5.51% in that time.

General Electric will be looking to display strength as it nears its next earnings release. On that day, General Electric is projected to report earnings of $0.51 per share, which would represent a year-over-year decline of 10.53%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $19.04 billion, up 3.29% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.74 per share and revenue of $75.89 billion, which would represent changes of +29.25% and +2.38%, respectively, from the prior year.

Any recent changes to analyst estimates for General Electric should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. General Electric currently has a Zacks Rank of #3 (Hold).

Digging into valuation, General Electric currently has a Forward P/E ratio of 26.37. For comparison, its industry has an average Forward P/E of 16.21, which means General Electric is trading at a premium to the group.

We can also see that GE currently has a PEG ratio of 3.77. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. 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 59, which puts it in the top 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow GE in the coming trading sessions, be sure to utilize Zacks.com.


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