Does General Electric Company (GE) offer a good opportunity for investors?

General Electric Company (NYSE: GE) stock fell -2.06% on Friday to $65.22 against a previous-day closing price of $66.59. With 6.29 million shares changed hands, the volume of the stock remained lighter than its average volume of 6.39 million shares. During the session, the Specialty Industrial Machinery company that operates in wider Industrials sector, reached to the highest price of $67.07 whereas the lowest price it dropped to was $65.16. The 52-week range on GE shows that it touched its highest point at $116.17 and its lowest point at $59.93 during that stretch. It currently has a 1-year price target of $87.82. With its current market cap of 74.23 billion, GE has annualized dividend of $0.32 while the current yield stands at 0.49%. Beta for the stock currently stands at 1.11.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of GE was down-trending over the past week, with a drop of -6.87%, but this was down by -12.78% over a month. Three-month performance surged to 1.05% while six-month performance fell -31.28%. The stock lost -32.64% in the past year, while it has lost -30.96% so far this year. A look at the trailing 12-month EPS for GE yields -4.02 with Next year EPS estimates of 4.61. For the next quarter, that number is 0.52. This implies an EPS growth rate of -159.20% for this year and 67.47% for next year. EPS is expected to grow by 45.90% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -19.90%.

Float and Shares Shorts:

At present, 1.10 billion GE shares are outstanding with a float of 1.09 billion shares on hand for trading. On Jul 14, 2022, short shares totaled 14.37 million, which was 1.31% higher than short shares on Jun 14, 2022. In addition to Mr. H. Lawrence Culp Jr. as the firm’s Chairman & CEO, Ms. Carolina Dybeck Happe serves as its Sr. VP & CFO.

Institutional Ownership:

Through their ownership of 73.16% of GE’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 43.25% of GE, in contrast to 27.66% held by mutual funds. Shares owned by individuals account for 0.75%. As the largest shareholder in GE with 7.90% of the stake, Capital Research & Management Co holds 86,642,960 shares worth 86,642,960. A second-largest stockholder of GE, T. Rowe Price Associates, Inc., holds 83,586,458 shares, controlling over 7.62% of the firm’s shares. The Vanguard Group, Inc. is the third largest shareholder in GE, holding 81,233,255 shares or 7.41% stake. With a 3.00% stake in GE, the American Funds Investment Company is the largest stakeholder. A total of 32,881,730 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 2.97% of GE stock, is the second-largest Mutual Fund holder. It holds 32,596,541 shares valued at 2.39 billion. Vanguard 500 Index Fund holds 2.24% of the stake in GE, owning 24,564,565 shares worth 1.8 billion.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for GE since 22 analysts follow the stock currently. There are 12 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 8 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With GE analysts setting a high price target of $110.00 and a low target of $72.00, the average target price over the next 12 months is $88.35. Based on these targets, GE could surge 68.66% to reach the target high and rise by 10.4% to reach the target low. Reaching the average price target will result in a growth of 35.46% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. GE will report FY 2022 earnings on 01/24/2023. Analysts have provided yearly estimates in a range of $2.90 being high and $2.65 being low. For GE, this leads to a yearly average estimate of $2.74. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. General Electric Company surprised analysts by $0.41 when it reported $0.78 EPS against a consensus estimate of $0.37. The surprise factor in the prior quarter was $0.06. Based on analyst estimates, the high estimate for the next quarter is $0.62 and the low estimate is $0.43. The average estimate for the next quarter is thus $0.53.

Summary of Insider Activity:

Insiders traded GE stock several times over the past three months with 0 Buys and 0 Sells. In these transactions, 0 shares were bought while 0 shares were sold. The number of buy transactions has increased to 41 while that of sell transactions has risen to 27 over the past year. The total number of shares bought during that period was 182,856 while 33,223 shares were sold.

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