Categories Analysis, Industrials
General Electric is literally going down the drain, sinks up to 10% today
General Electric (GE), the 125-year-old manufacturing veteran, lost as much as $6 billion in market valuation on Friday during intra-day trading, after a key analyst slashed its price target from $10 to $6. The revised price target by JPMorgan analyst Stephen Tusa is at a massive 29% downside from the current trading price.
Tusa’s price target of $6 is the lowest on the stock by any analyst. Taking into account the 17 analysts covering GE, the stock has an average price target of $12.73 with a moderate buy rating. The highest target is $21 given by Justin Bergner of Gabelli. The stock has 7 BUY, 8 HOLD and 2 SELL ratings.
GE stock fell up to 10% during intra-day trading on Friday as it sank to a 9-year low.
Justifying the price target slash, Tusa said in an investor note, “The outcome of GE results was worse than expected on almost all fronts. While liquidity is certainly debatable, we believe this is not really about liquidity, it’s about a deterioration in run rate fundamentals.”
General Electric misses on Q3 estimates, cuts dividend again
General Electric had earlier stated that it expects to miss its own full-year guidance as the manufacturing giant removed John Flannery from its helm. GE board was apparently not happy with Flannery’s pace of restructuring.
Larry Culp, who took charge in October, is currently focusing on rebuilding the ailing power business. He also slashed the quarterly dividend to one penny to free up cash flow, but Tusa was unimpressed by the “restructuring measures.”
“We estimate material dilution from weak fundamentals and portfolio moves, with little in return, going against the notion from a year ago that the company could get $20 [billion] in value without diluting the run rate of earnings/FCF,” Tusa added.
GE stock has lost 55% of its value in the past 52 weeks.
Follow our Google News edition to get the latest stock market, earnings and financial news at your fingertips
Most Popular
What to look for when CVS Health (CVS) reports Q3 earnings
Healthcare company CVS Health Corporation (NYSE: CVS) is all set to report earnings next week, with Wall Street expecting a mixed outcome. The company has been facing challenges in certain
eBay (EBAY): A few factors that helped drive growth in Q3 2024
Shares of eBay Inc. (NASDAQ: EBAY) stayed green on Friday. The stock has gained 32% year-to-date. The ecommerce leader delivered revenue and earnings growth for the third quarter of 2024,
CVX Earnings: Chevron reports lower revenue and profit for Q3 2024
Energy exploration company Chevron Corporation (NYSE: CVX) on Friday announced third-quarter 2024 financial results, reporting a decline in net profit and revenues. Net income attributable to Chevron Corporation dropped to
