In his annual letter to shareholders, Jeff Immelt outlines GE’s accomplishments in 2008 and the actions we are taking in 2009 to succeed. “We have built a foundation that can weather this economic storm,” Jeff writes. “I think this environment presents an opportunity of a lifetime. We get a chance to reset the core of GE and focus on what we do best… GE will be a better company winning through this crisis.”
Last year, the company earned $18 billion, our third highest year in history. When compared to our peer companies, our industrial organic revenue growth, margins, return on total capital, and revenue per employee were all higher. At the same time, GE put in place aggressive programs to lower costs and improve our cash position. As Jeff writes in his letter, to give GE a solid competitive advantage over the long-term, the company is focused on being global, driving innovation, building relationships and leveraging our strengths of size, expertise, financial capability and brand.
Read Jeff’s letter in GE’s 2008 Annual Report
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What’s the difference. This letter could be just another lie to us shareholders like many other times. I really now believe GE will be BK soon.
Dear Jeff Immelt,
As a shareholder I would like to know the reason for the share price decline and the dividend cut. I got GE at 20.10 when will I and all other investors see that target again. Is GE losing AAA status?
Thank you,
-silva
Mr.Immelt, no one has any faith in what you say because of previous statements you have made over the last 6 months that were not just true when you made them and you knew it. Please step aside and let someone rescue this once great untarnished company. As you once said recently about the dividend – it’s just the right thing to do. Board of directors please take note.
Same stuff I have heard from other CEOS (BSC etc..)
I have been a GE stockholder since 1970 ( when I went to work for them) I have never been to a shareholder meeting. I plan on attending this one if for no other reason to see if Jeff has the nerve to show up and face us. I have now seen that Jeff is a joke. It would be funny except he has ruined so many lives with his incompetence. I understand that the Ge Board has always been just a rubber stamp but they need to step up now and save the company from ruin and dump Jeff. I vote for John Rice to move up. He is an honest man from what I have seen.
Mr Immelt
There seems to be a GIANT creditability gap forming.
Right now the company is saying times are tough but we are positioning the company to surive. Analysts are saying that you are not and will have to raise capital, current estimates running anywhere from 0 to 40 billion. Instead of the typical dog & pony roadshow, why can’t GE hold some sort of workshop? and go through the Finance arm’s holdings so everyone can gain an understanding of what is the real situation.
ps I have no problem with the divdend cut.
Solution going forward – legislate that all people taking up a position on a board of a publicly listed company have to take a large part of their remuneration in stock, (hey we dont trust you guys anymore, basically its come down to that, look at some of the biggest failures in history, Arthur Andersons, Merril Lynch, Bear Stearns, WAMU, AIG, Northern Rock, Enron, Worldcom – Bernie Maddoff was in a position of Chairman of the NASDAQ, hell what is the rest of these so called leaders of our generation up to) so you want $5m as a package, then you get $2.5m in cash, and $2.5m in shares purchased on the market (not stock options) – and if you leave you are unable to sell these for a period of 3-5 years.
It seems that every time Jeff talks the stock tanks. I remember my Father saying " It is better to keep your mouth shut and let people think you are a fool then to open it and remove all doubt". I think Jeff should consider these words.
Immelt has no integrity … he has consistently misled GE shareholders since 4Q07. Immelt, Sherin, and all members of GE’s Executive Development & Compensation and Audit Committees should consider resigning for driving GE to a soon-to-be penny stock from being America’s premier stock!!!
Mr. Immelt please step down. It is pretty obvious that Wall St. isnt buying what you are saying and neither are we.
Shareholder Sues General Electric, Immelt Over Dividend Cut
http://money.cnn.com/
I sincerely hope that Mr Immelt does read these comments. First, If GE management is doing such a great job and the company is healthy, why is stock approaching 15% of what it was about a year ago and why did you slash our dividends? Forgetting how we got in such a hole, we the people that live on the dividends got a pay cut of 2/3! I think the investors now feel that GE management is continuing to increase their pay while cutting ours, therefore why should they invest in GE? I invested in GE thinking it was a cross section of industry and it would average out no worse that the DJ – was I wrong! To regain GE’s posture you must have a believeable and documented path to success which noone has seen.
I encourage everyone to read AR of everything they invest in, if your board doesnt have a stake in the company, and I mean a stake that’ll hit em hard if it topples – dont buy it. Lets get back to people running the company having to anti up, you’ll get rid of your Madoff’s etc. Can one of you American’s pass this on to Barack, I’ll run it by the Ruddster, Legislate ownership in a copy if you either a non-exec or an exec director with massive conditions – if you really want to run a company then own it!!!
I am optimist. GE is an incredible industrial company with positive cash flow. the healthy part of the financial arm is a competitive advantage. long term GE is better positioned than a lot of other companies to get out of this crisis. I just bought 36,000 Shares. I am not an employee of GE… but I am working for a big blue chip. Sure repositioning GE capital is not going to be easy…. it will cost billions in write off… but if GE is capable to hold the assets through the crisis I think GE will be well positioned. 2 mage trends are: health care and clean energy… GE is there. We will see… I am positive on GE… I recognize their corporate communication in this period has been extremely poor… and the dividend story quite imbarassing
AS much as I am truly trying it is very hard for me to belive anything Jeff Immelt says. I can only hope our pensions are safe as I no longer have any hope of the stock recovering. I am very concerned that if it goes below $5 all mutual funds will be forced to sell by law!
let’s confess..the shareholders are gamblers like Jeff
and let’s admit our foolishness in paying big salaries "victory has a thousand fathers- failure is an orphan"
we are the idiots ..and Jeff is a clever guy
The only words to describe this drop in the value of the common share price are "Staggering", "Cratering", "Gut-Wrenching" and "Devastating". This reminds me of a dramatic paper loss with TYC some years ago with the D.K. affair. I stayed the course then, bought additional shares into the unsubstantiated fear and I held it as I am going to do so now. I made a tremendous return then and believe that I will do so again with GE. The current situation is driven by emotion and that is shown by the above snippets. What analyst or expert has exhibited even one bit of ‘factual’ information to justify this drop? Additionally, the company has clearly and definitively stated that there is no justification for the drop in the additional 50% stock price over the last 45 or so days based on its capitalization, access to capital or leverage ratios. So management actually made a prudent business decision in real time to change course on the dividend? Now,no one has any faith in the management. So the talking heads and fear mongers are listened too because they can tap YOUR fear and the management is tarred and feathered for their communications as not just right, too much this or too little that but never just right. Well facts, have a more difficult time tapping into your emotions than fear and greed do. Well as one who actually runs a company, I can tell you that there is no crystal ball and no play book for the last 6 months. There is certainly little visibility and a lot of fear. Some of this is substantiated but much of it is not. At the end of the day the management is charged with running the company first and the stock second and they are responsible for doing it with facts not emotion.
Now the problem with this stock price is as it has always been with all stock prices, that the retail investor invests emotionally and the talking head prognosticators are usually wrong. So who is usually right? Typically but not always, over time, the professional investor. Who do you think is currently on the buy side of the daily price discovery process, the emotional individual investor? Who do you think is selling it to you when the price is sky high and it feels so right to buy it? Who do you think is buying it when the price stinks like rotten eggs?
Read the emotion in these posts above and decide if factual information is guiding the current pricing process. So how did we get here? Did anyone put a gun to your head and force you to become a shareholder in GE? Probably not. Each of us made a decision to be an owner/employee/investor in this company based on your outlook. But alas there always has to be a villain and some one else to blame for our decisions.
This anger (emotion) is easily understood as the process feels like it is shaking our hard earned money from our pockets, this is out of our control and the world will always be like it is today, painful. The corollary is true in the topping process but fact is that there is no loss or profit until you sell or buy which is exactly what the professional investor is looking for. The fact is that the world will not always be like it is today, it just feels like that today. The fact is that the situation will either be better or worse but over time it will be different than it actually is today. Now if you having a problem with the emotions and many do. Don’t blame the management until the facts are on the table and warrant such action. Instead ask yourself, why are you in the stock market? Do you understand the risks? What has changed in the business model? Did you make an inappropriate decision based on your time frame? Is this really risk capital invested? Do you need a villain to blame if it does not work out?
So here is the bottom line…
If you think GE is going to go to zero then sell it today and preserve your capital. If you think that management is all the terrible things said above then sell your stock and preserve your capital. If you think that the emotional component of the price discovery process is taken the price too low and fundamentals are disconnected from the business realities then buy some more stock and it will go up. If you simply do not have enough information yet then turn off the 24/7 speculation and double guessing machine (television) and go enjoy your life until the facts change to either justify or change your "opinions". It is really that simple if you are already a shareholder.
Now of course there are real economic issues and to be honest most folks with money in the stock market simply do not have the appropriate economic education to make appropriate business decisions with their money and that is a shame. It is also another discussion
To…996driver………. good article, read it twice , and agree with your commentary…………..I remember TYCO and TYCO was and is not GE then and now . TYCO was a fantastic company then , your decision to stay with it concurred with mine. Lucky TYCO didn’t have a capital division to worry about………. I also agree that GE is not a sell here with the negative commentary from analyst’s all coming from the sell side mentality. Most of these analyst’s also work at firms making a market in GE stock, that they never tell the public. I would also bet the ranch, these market makers are trading GE from the short side hedged with put/calls on both sides of the trade. Smart if you could do it………My opinion from 15 down is mostly self fulfilling, GE stock demise corresponded after the banks all hit the bottom so GE being the only entity with a capital sector, the analyst’s took full advantage of it. This is pure insanity selling under 7………..in short (no pun intended) I’ll keep my GE shares and start thinking about buying GE calls into Jan 2010 …………
Please pull your "If I Only Had a Brain" ecomagination commercials. As a shareholder, at current stick price levels, these ads are insulting. In addition, everyone in my office has remarked how closely Jeff Immelt resembles that dancing scrarecrow. Thanks
Absolutely agree Jerry, pure panic selling, we close to what we were at in Sept-Oct 2007, pure euphoric buying, now at the opposite end, pure euphoric selling. This time its different, I think the bowline is being pulled back right now and when it hits bottom its gonna rebound like you wont believe, forget your 4-5 year bull runs this will be a bear in reverse a short, but very pronounced rally – Dow 20k in 18 mths.
Look at the papers, headlines about doom and gloom, its every where, you cant escape it, fear is taking over, just like greed took over in late 2007. One red flag for me telling me its time to get out was when the Fin Review did a story on the richest man in Australia, he was the CEO of a big iron ore miner, on paper he was richer than Murdoch and Packer CEOs of companies making money, this miner though hadnt even sold an ounce of ore but he became our richest individual, someting wrong there. Your red flags now are your headlines about depressions and credit crunches, the companies that couldnt evolve out of this are gone – keep your head dont be swayed by the fear, you’ll feel even worse when this market bounces back, and it will, with the same force that it crashed with and if you’re in cash when it does – ouch!!
Red Flag, you sound like some who has cash good luck to you, but the reality is that no one else does so you small handful that have cash wont be enough to move our market to where we are use to seeing it….it’ll take 100 years to get it back to where it was.
Where is the apology to shareholders who were finding their retirement with GE dividends? Where is the apoloogy rto all the widows and orfans who depended on GE. Couldn’t you have taken su doen slowly. I bougt most of my shares in the high 40′s but held them for the dividends. The stock decline and the dividend declinedevastaing to my retirement. Jeff Immelt must have known that many retirees were depending on him. They touted their great dividends paid in dollars. And I haven’t heard an apology yet. I am 64 and sleepless in Bethesda.
I am a small stock holder in GE but my family is heavily invested. My Grandfather worked as a mid level manager for GE from the end of WW2 until the late 50’s. I have been tracking GE’s movements most of my life, GE has been a part of my life since I was born. Over the past 10 or so years I have been very disappointed in the companies moving so much of its manufacturing over seas, but it seemed to be a popular trend with a lot of companies of late. I was happy to see the report on Lou Dobbs last night quoting from an upcoming letter from Jeff Immelt about this trend:
“The U.S. must return to its manufacturing roots. He said moving the country away from manufacturing and towards financial services was wrong. Immelt said, “I believe that a popular, 30-year notion that the U.S. can evolve from being a technology and manufacturing leader to a service leader is just wrong…. real engineering was traded for financial engineering. In the end, our businesses, our government and many local leaders lost sight of what makes a nation great: A passion for innovation.”
Thank you Jeff;
I will be looking forward to receiving this letter and reading the comment myself
We the people are watching GE. We know that Jeff Immelt ran GE into the ground and Obama will be the new GE Czar as he is trying to get the tax payers to pay for the "green" platform. I was a loyal GE buyer and manage 7 rentals properties as well as my own home. I also interact with many property managers and have spread the word to boycott ALL GE products because of this travesty as well as the far left agenda and views of your "leader" (as evident with MSNBC). GE stock wil continue to tunble unless you as shareholders real Immelt in or get rid of him.
Donna
Where is Mr. Walsh, we need him back. GE was over $50 per share when he left, 9 years later it is at $16. My Dad worked at GE for 30 years, he is rolling around in his grave after the performance of Immelt. Immelt in bed with Obama and the liberal media, no one watches MSNBC, except left wing kooks. It is time for the board of directors to release Immelt from the good ol boys network into the unemployment line. You on the board represent the stockhoders, so open your eyes and fire this guy before he ruins all the stockholders dreams for a decent retirement.