Comment
General Electric’s CEO recently stated in Barron’s, ‘For the first time in maybe 20 years, our set of industrial businesses can grow to or faster than our financial businesses. . . . Rising demand for power generation in the U.S. and elsewhere will be another big driver of GE’s earnings in coming years. . . . The developing world’s appetite for new power plants and equipment, as well as other infrastructure projects, will dwarf that of the U.S. and Western Europe in the next decade.’ …“Far more important, the global economy is growing by a healthy 4% a year, and emerging economies by even more, creating new and inviting markets for GE’s industrial and infrastructure products. The company’s flagship infrastructure segment enjoys operating margins of nearly 20%, and is likely to see sales grow by 15% to 20% annually in the next few years. As a welcome consequence of these trends, GE has reached the so-called tipping point.”
Summary
Based in Fairfield, Conn., GE is a massive conglomerate with leading positions in an array of industries, including energy, transportation, health care, media, and consumer products. It also offers a wide variety of commercial and consumer finance products, such as credit cards, through its financial-services division. As a nod to its longevity, GE is the only surviving member of the original 12 stocks in the 1896 Dow Jones Industrial Average.
