|Bid||9.34 x 40700|
|Ask||9.35 x 3200|
|Day's Range||9.14 - 9.45|
|52 Week Range||6.40 - 13.25|
|Beta (3Y Monthly)||1.13|
|PE Ratio (TTM)||N/A|
|Earnings Date||Oct 30, 2019|
|Forward Dividend & Yield||0.04 (0.43%)|
|1y Target Est||10.76|
The Federal Reserve meeting is scheduled for September 17-18. At its last policy meeting in July, the Fed lowered rates by 25 basis points.
Keep betting on Larry Culp to turn around General Electric. One year into his tenure at the top, Culp faces steep challenges, and the stock market isn’t yet convinced he can pull it off. A corporate turnaround has three phases.
General Electric's (GE) tender offerings to purchase its U.S. dollar and Euro-denominated debt securities will help it strengthen the balance sheet.
General Electric CEO Larry Culp spent time with investors Thursday at an investor conference in California. Here’s what he said about two big issues facing GE: debt and restructuring.
GE will receive $2.7 billion in net proceeds from reducing its stake in Baker Hughes. GE announced tender offers for its dollar- and euro-denominated bonds.
(Bloomberg) -- General Electric Co. plans to buy back as much as $5 billion of bonds as the manufacturer seeks to cut its debt load as part of its turnaround.The repurchase will cover up to $2.5 billion of dollar debt and the equivalent of $2.5 billion (2.28 billion euros) of euro-denominated notes, GE said in a statement Thursday. The company said it wouldn’t expand the size of the buyback plan.Reducing debt is a cornerstone of Chief Executive Officer Larry Culp’s attempt to overhaul GE after one of the worst slumps in the company’s 127-year history. Since taking the helm last year, Culp has been pruning operations to focus on making jet engines, power equipment and medical scanners while tackling more than $100 billion in borrowing.“We’re doing what we said we’d do,” Culp said at a Morgan Stanley conference Thursday. “The reset year thus far here in early September is playing out fundamentally in line with what we anticipated, but we know we have a lot more to do both with respect to the balance sheet and the way we run the business.”The shares fell 1.1% to $9.26 at the close in New York. GE has advanced 27% this year, compared with a 22% gain for a Standard & Poor’s index of U.S. industrial companies. GE lost more than $200 billion in market value during the two-year period ending Dec. 31, as profits dropped amid flagging demand for gas turbines and high costs.The company said Wednesday it would raise about $2.7 billion by cutting its holdings in oil-services company Baker Hughes to a minority stake. That sets GE up for about $38 billion in asset sales including the pending $21.4 billion sale of GE’s bio-pharmaceutical business to Danaher Corp., Culp said.GE reiterated Thursday that it seeks to reduce the debt load at the industrial businesses to under 2.5 times a measure of earnings and is evaluating other options to cut debt, including pension funding and intercompany debt repayment between GE and its financial services unit.That means GE will have to erase about $25 billion of debt at the industrial businesses from $51 billion at the end of the second quarter, Culp said. Improving profits at the company’s businesses will take more time, he said.“With respect to running the businesses, this is what takes longer, both in terms of how we operate and having that translate into results,” Culp said.Rate ImpactThe drop in interest rates will add about $7 billion to GE’s pension obligations and deliver a hit to insurance-reserve assumptions of “somewhere south” of $1.5 billion, Culp said. GE made contributions of $6 billion to the pension fund last year that covers the company through next year, he said.GE shares last month posted their biggest one-day plunge in 11 years after financial investigator Harry Markopolos skewered the company’s accounting. Markopolos, best known for blowing the whistle on Bernie Madoff, accused GE of fraud over the handling of its insurance and oil businesses and said “impending losses will destroy GE’s balance sheet.”The Boston-based company called the claims meritless, with Culp criticizing the report as “market manipulation, pure and simple.” A number of Wall Street analysts and some prominent investors came to GE’s defense as well.GE is being more transparent about its financial situation to “demystify it as much as we humanly can,” Culp said.Major IssuerThe company said in March that it was looking at buying back debt, and said in January that it doesn’t expect to issue new debt until 2021. GE is one of the 10 biggest issuers of corporate bonds in the Bloomberg Barclays US Corporate Bond index outside of the financial sector.The buyback offer expires on Oct. 9. Holders that submit their bonds by Sept. 25 are eligible to receive an early participation premium.The dollar-denominated bonds that can be bought back mature between 2022 and 2044, while the euro-denominated notes are due between 2022 and 2037. The company said $8 billion of dollar-debt and 10.5 billion euros of euro-denominated debt is eligible for the offer.JPMorgan Chase & Co., Bank of America Corp. and Goldman Sachs Group Inc. are managing the buyback. D.F. King & Co. is serving as the information and tender agent.(Updates with asset sales in fifth paragraph.)\--With assistance from Brendan Case, Molly Smith and Tony Robinson.To contact the reporters on this story: Claire Boston in New York at email@example.com;Thomas Black in Dallas at firstname.lastname@example.orgTo contact the editors responsible for this story: Nikolaj Gammeltoft at email@example.com, Dan Wilchins, Christopher DeRezaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
The SPDR S&P 500 (NYSEARCA:SPY) hit new all-time highs on Thursday. Who would have predicted that for the stock market today?Not many were looking for such a robust rally to take place over the past few trading sessions. But InvestorPlace readers were ready. They knew that the stock market was trading in a well-defined range throughout the month of August and they knew when that range resolved to the upside.InvestorPlace - Stock Market News, Stock Advice & Trading TipsOnce resistance gave way and we saw follow through from the bulls, that's when it was clear new highs were possible. In fact, we wrote: "Above resistance could send the S&P 500 back to 3,000, while a move below support likely brings up a test of the 200-day moving average."So what's causing this rally anyway? Markets liked the de-escalating tone between China and the U.S., even though there some reports say the trade war will not likely be resolved any time soon. More Quantitative Easing, Please?For those looking for more quantitative easing from the Federal Reserve, don't hold your breath. The Fed is scheduled to make its rate decision next week on Wednesday, Sept. 18. As it currently stands, the Fed Funds Rate is pricing in an 88.8% probability of a 25 basis point cut next week. The other 11.2% probability has the Fed keeping rates unchanged.Put simply, the U.S. is not in the economic position -- either with low growth or negative interest rates -- to warrant more stimulus. But the European Union is. * 10 Battered Tech Stocks to Buy Now The European Central Bank announced a 10-basis-point cut in its deposit rate to -0.5%, in-line with expectations. The ECB also announced that it will restart its QE program to the tune of $20 billion per month beginning Nov. 1. While ECB president Mario Draghi says there's only a low chance chance of an E.U. recession, those odds have increased.QE should be a boost, but it's concerning that it's needed after a near-decade of various policies. Movers in the Stock Market TodayIt was an exciting day in the stock market today, if not just because equities are flirting with their all-time highs. However, not all assets are moving favorably.While gold prices -- and the SPDR Gold Shares (NYSEARCA:GLD) -- closed higher on the day, GLD finished well off its morning highs. The can be said for bonds too, via the iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT). The fall in bonds helped pave the way for bank stocks to continue their rally on Thursday, even as they approach resistance.The Top Stock Trades column took a closer look at the bank stocks earlier today.What else was moving?Aurora Cannabis (NYSE:ACB) fell roughly 10% and hovered near its session lows in the stock market today. The decline came after the company reported its quarterly results, missing revenue expectations and showing margin pressure. The woes of the cannabis space continue.Shares of General Electric (NYSE:GE) fell 1.2%, but Baker Hughes (NYSE:BHGE) was making waves after the former became a seller of the latter.BHGE opened notably lower on the day and fell to $21.36. However, it finished higher by 1.5% at $22.63 despite GE announcing it will cut its stake from 50.3% to roughly 39.5% as it looks to raise capital.The IPO market remains a mixed bag, with the latest shake-up coming from SmileDirectClub (NASDAQ:SDC). Shares priced at $23, above the $19-$22 range. But that didn't please investors, as shares tumbled 27.5% in their debut. Ouch. Heard on the StreetShares of Activision Blizzard (NASDAQ:ATVI) got off to a hot start in the stock market today. However, the stock only managed to climb 1% by the time the market closed. That's despite Nomura analysts upgrading the stock to "buy" and raising their price target from $49 all the way to $64. The target implies more than 16% upside from Wednesday's closing price.Wells Fargo analysts are ringing the bell on Caterpillar (NYSE:CAT) and Deere (NYSE:DE). They downgraded both stocks from "outperform" to "market perform," assigning price targets of $170 and $143, respectively.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Battered Tech Stocks to Buy Now * 7 Strong-Buy Stocks Hedge Funds Are Buying Now * The 7 Best Penny Stocks to Buy The post Stock Market Today: Should Investors Expect More Quantitative Easing?Â appeared first on InvestorPlace.
(Bloomberg Opinion) -- It’s been a busy week for General Electric Co. On Tuesday, the company announced it would sell another chunk of its stake in its Baker Hughes oil and gas venture, ultimately raising about $3 billion. Two day later, it said it would buy back up to $5 billion of bonds. This activity gave CEO Larry Culp something concrete to point to on Thursday when he took the podium at a Morgan Stanley conference to update analysts and investors on the industrial conglomerate’s turnaround progress. “We’re doing what we said we would do," Culp said. That means "tending to the balance sheet, making sure that we’re strengthening our overall financial position, and making sure that we’re in a position to run the businesses better."GE’s efforts to reduce its bloated debt load are a positive; that’s what it’s supposed to be doing. Culp’s ability and willingness to be proactive is undoubtedly an improvement over former CEO John Flannery’s long stretches of paralysis. But the timing of this flurry of deleveraging steps strikes me as slightly curious.Most companies wouldn’t go around buying back bonds when rates are so low; they would swap them out for new bonds at better terms. GE, however, has pledged not to add any new debt through 2021, and appears to be trying to signal its liquidity is such that it doesn’t need to. Yet Culp has also talked about running the company with a higher cash balance in order to reduce its reliance on commercial paper. And the $21.4 billion divestiture of GE’s biopharmaceutical business to Danaher Corp. – the linchpin in Culp’s debt reduction plan – hasn’t closed yet.Perhaps the Baker Hughes stake sale and the bond buyback were planned well in advance; perhaps GE is just being opportunistic and taking advantage of recent trading conditions. I can’t help but notice, though, that GE’s actions this week appeared to hit at the heart of criticisms made by Bernie Madoff whistle-blower Harry Markopolos last month in a lengthy, explosive report.Markopolos has an agreement with an undisclosed hedge fund that will give him a share of the profits from bets that GE shares will decline. GE has called his allegations “meritless.” His report claimed GE needed to immediately funnel $18.5 billion in cash into its troubled long-term care insurance business and accused the company of avoiding a writedown on its Baker Hughes stake. One way to read the debt buyback is that GE must not be too worried about a fresh cash shortfall at the insurance unit if it’s willing to plop down $5 billion to repurchase bonds on a voluntary basis. And GE’s stake sale this week will bring its holdings in Baker Hughes below 50%, which will prompt a charge that could be in the ballpark of $8 billion to $9 billion but also allow management to put one more inevitable writedown behind them.(1)There were a number of flaws in the Markopolos report, not least his liberal use of hyperbole, but it struck a nerve with investors who were already wary of more negative surprises at GE and the opaqueness of its underlying financials. Whether or not there’s any truth to his allegations, being on the hot seat like that appears to have shaken GE executives as well.What’s most telling is the one Markopolos criticism that GE hasn’t yet moved to address, and that is the lack of detailed transparency in its financial statements and the seeming differences in its aviation unit’s accounting relative to engine partner Safran SA. Culp missed an opportunity when he became CEO to move away from GE’s historical tendency to rely on a myriad of adjustments and a micromanaging of Wall Street expectations to bolster the appearance of the company’s results. This week’s actions and Culp’s presentation were in a way a reminder that of all of Markopolos’s claims, questionable as the others may be, that one has the potential to stick.Otherwise, the key takeaways from Culp’s Thursday presentation were that he expects the drop in interest rates to result in a “somewhere south” of $1.5 billion hit to its GAAP reserve assumptions for the long-term care insurance business, before accounting for any other adjustments as part of a third-quarter test. GE's projected pension benefit obligations, meanwhile, will also increase because of the drop in interest rates. Offsetting that is an improvement in returns, but GE is still looking at an impact in the $7 billion range, Culp said. Neither of those figures are disastrous, but serve as a reminder that it’s not just regular old debt that’s looming over GE. There are many other demands on its cash.Culp gave no update to GE’s expectation for roughly zero dollars in industrial free cash flow this year. Interestingly, he did allude to the idea that the company’s forecasts for 25 to 30 gigawatts of gas turbine demand this year may prove overly dire; still, I remain skeptical of GE’s ability to drive a huge surge in free cash flow at the power unit over the next few years. Other challenges at the company include persistent questions about the true underlying free cash flow of the aviation unit, the loss of cash-flow contributions from divested assets and the need to backstop its huge underfunded pension balance with more cash. Culp didn't rule out additional contributions to the pension over the next few years.Progress on the debt reduction front is good, but without a significant increase in free cash flow, it will be a while before GE can shift investors’ focus elsewhere. (1) GE said in July that deconsolidating Baker Hughes's results from its own would prompt a $7.4 billion writedown, based on the company's stock price at the time of $24.84. This week, it said every $1 change in Baker Hughes's stock price would increase or decrease that number by about $500 million. GE's share offering was priced at $21.50 and the stock was trading on Thursday for about $22.50.To contact the author of this story: Brooke Sutherland at firstname.lastname@example.orgTo contact the editor responsible for this story: Beth Williams at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brooke Sutherland is a Bloomberg Opinion columnist covering deals and industrial companies. She previously wrote an M&A column for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Baker Hughes said it was committed to safety and that it operates its oilfield services facility in Kenai in compliance with the law. "We vigorously deny the claims made against us, and will exercise our right to present evidence that the allegations are without merit. We have confidence in the judicial system and that the full facts will be presented in court,” a spokesperson said.
General Electric Company (NYSE: GE ) announced Wednesday that it will divest part of its stake of Baker Hughes A GE Co (NYSE: BHGE ) and released pricing details. What Happened GE said in a press release ...
The move will take GE out of majority control over Baker Hughes, a change that the duo have worked toward for more than a year.
GE will sell about $3 billion of Baker Hughes stock, a move that would take it from a majority owner, with just over a 50% stake in the company, to a minority one.
Larry Culp has been CEO of General Electric (NYSE:GE) for a year now and has made impressive strides against one of its biggest problems: the huge debts incurred by predecessor Jeff Immelt.Source: Jonathan Weiss / Shutterstock.com Long-term debt was down to $90 billion in June, and Culp has set plans to reduce it by about $30 billion more. These plans include the sale of GE Healthcare's biopharma unit to Danaher (NYSE:DHR) and a slow exit from Baker Hughes (NYSE:BHGE).But some of the biggest overhangs from the Immelt era, like GE Power, remain. So does one from the era of Jack Welch -- the reinsurance of long-term care policies highlighted by whistleblower Harry Markopolos.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Where's the Beef?What's worse is that the asset sales leave GE with few avenues to growth -- and these growth avenues are why investors buy stocks.GE reported a small loss of 1 cent per share for the June quarter. Its $28.8 billion of revenue was down over $1 billion from the previous June. Losing the biopharma unit and, eventually, taking Baker Hughes' revenue off the balance sheet, will reduce revenue further. * 10 Battered Tech Stocks to Buy Now Culp seems to be two-thirds of the way to a turnaround. He has stopped the bleeding and created a new, more transparent corporate culture. Growth is the next step.In December 2018, GE filed to spinoff its most promising growth avenue, GE Healthcare, through a mid-2019 IPO. But Culp hasn't talked about it in months. In February, Culp told CNBC that a 2019 IPO looks "unlikely." Many investors are waiting for an update.GE Healthcare accounts for one-sixth of the company's sales and nearly half its profit during good times. It seems to be the perfect platform on which Culp could work the magic he worked at Danaher. There he bought smaller healthcare companies, built their value and sold judiciously.GE Aviation, the other big profit driver, faces a $400 million per quarter hit to cash flow from the Boeing 737-MAX scandal. But the unit continues to perform, generating military contracts even as foreign nationals get hauled into court for stealing GE's trade secrets. Analysts are Pounding the Table for GE StockDespite a lack of growth catalysts, analysts keep pounding the table for GE stock. A Citi analyst has a "buy" rating on the stock. Others have dismissed Markopolos' charges, which I detailed in July, as overwrought.The argument is that with less debt and business prospects improving, the company is trading at barely two-thirds its sales.Any kind of profit would thus be a catalyst for the shares, initially as a defensive play but later, based on Culp's acquisition wizardry. This is especially true if, as some analysts now believe, it has enough reserves to handle the long-term care losses. The Bottom Line on General Electric StockIt's hard for me to buy the optimism yet, but there's an argument to be made.I think analysts still underestimate the damage Welch's long-term care time bomb could do. Given the high cost of nursing care, and the average age of those insured, this will remain a problem for years to come.But by the end of this year Culp may have cut GE's debt nearly in half through asset sales. If GE Power really is on a "positive trajectory," as one analyst recently claimed, it would take care of the last big downside risk.The question then becomes how Culp can create growth. The June quarter showed GE with over $71 billion in cash and short-term investments on its books. Some of that is committed to the remains of GE Capital, which Immelt used as a cash cow to build his power and energy conglomerate.But there may be enough there for Culp to shop for a healthcare acquisition. If he makes one, the stock will rise.Dana Blankenhorn is a financial and technology journalist. He is the author of the mystery thriller, The Reluctant Detective Finds Her Family, available at the Amazon Kindle store. Write him at firstname.lastname@example.org or follow him on Twitter at @danablankenhorn. As of this writing he owned no shares in companies mentioned in this article. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Battered Tech Stocks to Buy Now * 7 Strong-Buy Stocks Hedge Funds Are Buying Now * The 7 Best Penny Stocks to Buy The post Can General Electric Stock Move Past Immelt and Welch's Sins? appeared first on InvestorPlace.
Moody's Investors Service ("Moody's") said that the planned sale of a portion of its shares in Baker Hughes, a GE Company, LLC is credit positive but does not affect the ratings of General Electric Company, including the Baa1 senior unsecured rating and the P-2 short term rating. General Electric Company (GE) is a global diversified manufacturing company with operations in five industrial segments: Power, Renewable Energy, Oil & Gas, Aviation and Healthcare. GE has a wholly-owned finance subsidiary, GE Capital Global Holdings, LLC, which includes leading aircraft financier GE Capital Aviation Services (GECAS).
General Electric Co. announced Thursday a tender offer to buy back up to $5 billion worth of its existing debt. The repurchase includes up to $2.5 billion for U.S. dollar-denominated debt and up to $2.5 billion of euro-denominated debt. The industrial conglomerate said it will continue to evaluate potential deleveraging actions, including pension funding and intercompany loan repayment from GE to GE Capital. The dollar-denominated debt subject to the tender offer include 2.700% notes due 2022, 3.375% notes due 2024, 4.125% notes due 2042 and 4.500% notes due 2044. GE's stock, which rose 0.6% in premarket trading, has lost 9.0% over the past three months but has gained 28.6% year to date, while the Dow Jones Industrial Average has tacked on 4.4% over the past three months and rallied 16.3% this year.
GE Announces Tender Offers to Purchase up to $5,000,000,000 of its Existing Debt, including for Certain of its Outstanding U.S. Dollar-Denominated Debt Securities in an Aggregate Purchase Price of up to $2,500,000,000 and for Certain of its Outstanding Euro-Denominated Debt Securities in an Aggregate Purchase Price (U.S.
Investors were pleased with the European Central Bank’s decision to cut interest rates and introduce a stimulus package of bond purchases, as well as the White House’s delay of a new round of tariff increases.
General Electric's (GE) offering of Baker Hughes' shares to the public and Baker Hughes' decision to buy back own shares will likely raise roughly $3 billion. Funds will help in reducing debts.
BNSF Railway, the nation's largest railroad, is pushing forward with development of a battery-electric locomotive alongside Wabtec.