General Electric Looking Better And Better

As the details of yesterday’s shareholder meeting at General Electric (GE) hit newsstands, we are left with the impression that GE is looking better and better as an investment.

Yes, shareholders were pretty livid about the dividend cut and the amount of CEO Jeff Immelt’s compensation. Yes, earnings have dropped 35% and GE has a number of divisions like it’s entertainment and financing units that have performed poorly. And yes, there was even talk of breaking up GE into smaller companies.

But it’s all a smokescreen.

GE is looking better considering its size, and markets that it serves. In fact, earnings actually beat forecasts. Yes, forecasts were low - but again who cares, earnings forecasts have all been guesswork anyways over the last few quarters.

After the dotcom bust, GE shares were cut in half. Since its high of over $41 in 2007, the share price has plummeted even worse, over seventy percent. But it’ll come back.

GE is looking better as one of the broadest reaching companies producing some of the most complicated products on the planet. From engines to turbines to power plants, GE has made itself a player across almost all sectors and most countries.

We’ve talked before about how GE is closer to a mutual fund than a single stock, but the truth of the matter is that GE will emerge from this recession as it has from past ones - just as strong. Picking up some GE stock at below $15 is about the clearest long-term value play we can think of.

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