Setting the record straight on GE’s performance

20 Comments

1. Chris says:

   February 11, 2009 at 7:30 pm

   Fighting back with facts! I love it.
2. Keith says:

   February 12, 2009 at 10:30 am

   Keep the facts coming. Leave no time between false reports and a response. Also as part of the President’s economic advisory council, consider pushing for the elimination of the practice of option buying. The stock market is a place for investors and not gamblers.
3. disqualifed " research" says:

   February 12, 2009 at 10:34 am

   If such a "widely-circulated financial research" institute could make such a misleading information and releasing confusing guide to the market …it is questionable what behind their really intention…It is suspicious, that if they have really "research" or even did not "search" at all for such a simple data and make mistakes…what a "research" institution…it is assumed they deserve to "search a job" on other businesses instead of finance…their are disqualified…By performance rating, that are bottom 5%…
4. Chris says:

   February 12, 2009 at 1:27 pm

   I’ll say it here too:

   I understand frustrations are high, but to label Mr. Immelt a failure (after one of the worst environments the company has ever seen) is pushing it and unjustified in my opinion.

   10 year track record of GE the company:

   Revenues (in millions):
   1999 – 111,630
   2000 – 129,853
   2001 – 125,913 (Mr. Immelt takes over)
   2002 – 131,698
   2003 – 134,187
   2004 – 152,363
   2005 – 149,702
   2006 – 163,391
   2007 – 172,738
   2008 – 182,515 (even with the environment it faced)

   Net income:

   1999 – 10,717
   2000 – 12,735
   2001 – 14,128 (Mr. Immelt takes over)
   2002 – 15,133
   2003 – 15,589
   2004 – 16,593
   2005 – 18,275
   2006 – 20,666
   2007 – 22,468
   2008 – 18,089 (still made a profit in a serious economic collapse in the market as a whole)

   ROE:

   1999 – 26.3
   2000 – 27.4
   2001 – 26.8 (Mr. Immelt takes over)
   2002 – 25.5
   2003 – 21.8
   2004 – 17.5
   2005 – 16.6
   2006 – 18.6
   2007 – 19.7
   2008 – 16.4

   Pretty good and consistent ROE (especially when you consider all that GE has to manage)

   Dividends:

   1999 – 0.49
   2000 – 0.57
   2001 – 0.66 (Mr. Immelt takes over)
   2002 – 0.73
   2003 – 0.77
   2004 – 0.82
   2005 – 0.91
   2006 – 1.03
   2007 – 1.15
   2008 – 0.93 (still paid a dividend in one of, if not the, worst years in GE’s history due to the environment)

   What I think people are upset with, equity price in the market (which Mr. Immelt doesn’t set) — using high prices for each year as reference point as well as P/Es at the time for a measuring stick:

   1999 – $53.17 P/E 50 (at or near tech bubble high)
   2000 – $60.50 P/E 48 (at or near tech bubble high)
   2001 – $53.55 P/E 38 (unwinding of market begins; Mr. Immelt takes over)
   2002 – $41.84 P/E 28 (still too high of a P/E)
   2003 – $32.42 P/E 21 (still too high of a P/E)
   2004 – $37.75 P/E 24 (still too high of a P/E)
   2005 – $37.34 P/E 22 (still too high of a P/E)
   2006 – $38.49 P/E 19 (P/E more reasonable)
   2007 – $42.15 P/E 19 (P/E more reasonable)
   2008 – $38.52 P/E 20 (E in P/E can’t be measured do to unruly market conditions; not a good indicator of pricing at this time)

   I think if people take a realistic look at the numbers, Mr. Immelt has actually done a good job of leading this company. It’s not Mr. Immelt’s fault that the market overvalued the stocks in the late 90s and through the early part of this century; the market did that and the market dropped it back to within reason.

   Look where Mr. Immelt has positioned this company for the future. In every areas that GE does business, they will see profits going forward because the world needs what GE provides (and that need will pick up strength again as this economic fiasco subsides). U.S., China, India, Brazil, former parts of the Soviet Union, the Middle East — they are/were/will all expanding in the way of infrastructure/energy, medical, rail, airlines, and they will need financing for all of it. What has Mr. Immelt built this company to do over the last decade, serve those areas and serve them well.

   People can bash Mr. Immelt and this management team all they want, but the facts simply don’t represent reality. You’re mad because the stock price is down and dividends might need readjusting for legitimate business reasons and I get that. However, hold on, and GE will make its shareholders happy going forward.
5. Chris says:

   February 12, 2009 at 2:58 pm

   Oops:

   Instead of "facts simply don’t represent reality" it should read, "the criticism simply doesn’t represent reality."

   My mind works faster than my fingers:(
6. Chris says:

   February 12, 2009 at 4:24 pm

   I guess I’d be a hypocrite if I didn’t do this today:

   BUY 75 GE $11.5098 $870.24 XMA5########### CASH 2/12/2009 3:40:39 PM
   2/18/2009
7. Richard says:

   February 13, 2009 at 1:47 pm

   Jeff Immelt has been a master navigator through this difficult period.
   We have a long, extremely difficult transition to an economic "new world order", but not only will we (GE) survive that transition, with the GE management team’s agility, the company will thrive!
8. Jerry M. says:

   February 17, 2009 at 9:56 am

   The janitor is more qualified to manage GE then the guy running it into the bankruptcy courts commonly known as the CEO
9. Jerry M. says:

   February 17, 2009 at 10:10 am

   Eighty-ate cent to ‘SEE YA’
10. Jerry M. says:

    February 17, 2009 at 10:12 am

    When GM is a better buy then GE what the heck is this world coming too.
11. Jerry M. says:

    February 17, 2009 at 10:18 am

    Heck my Mercedes has more value then GE, the gas in my tank is worth more then GE
12. Jerry M. says:

    February 17, 2009 at 10:19 am

    In fact my kids piggy bank is worth more then GE
13. Jerry M. says:

    February 17, 2009 at 10:19 am

    A bum on the street has more cash in the bank then GE
14. Jerry M. says:

    February 17, 2009 at 10:21 am

    Guess the bum has better management skills then Immelt
15. Jerry M. says:

    February 17, 2009 at 10:24 am

    Come on, fire this jerk along with the board. I promise, the stock would fly to 11 post.
16. Jerry M. says:

    February 17, 2009 at 2:46 pm

    When I’m carrying more cash in my pocket then GE’s capitalization . Look out below
17. A says:

    February 18, 2009 at 12:17 pm

    Jerry M. If you feel that strongly about the kind of company GE is and its cash position, why not quit your job and go elsewhere….where it’s safer and better…BofA, Wells??? Grass any greener over there??? Didn’t think so. Bet you’re glad your still employed….by GE. Believe a thank you note is in order here and not this kind of needless cyber-babble.
18. Jerry M. says:

    February 18, 2009 at 1:19 pm

    My dear Mr./Mrs A I am neither employed by GE nor employed any where else, I’m retired living on a fixed income with some of that income from GE. So as a shareholder needless to say, management from the upper echelon of GE remain inept, when a company is run with a diminishing asset since 2001 and realizing the ups and downs over the time frame, GE managed to and continuously faulted.

    Mr./Mrs. A I am an owner or better, part owner of GE with Immelt as my surrogate whose fiduciary requirements are/is to provide reasonable valuation to the shareholders unquestionably, not reduce a 300 billion company into the ashes of the abyss.

    For a brief moment GE was 1/2 point from the aybess; meaning under 10$ a share, every fund would be REQUIRED to sell, further devaluing GE to 5 dollars a share or worse. Not good for me, not good for GE and not good for hard working GE employees whose 401 are in the abyess as I write.
19. Wally Kelleman says:

    February 18, 2009 at 4:42 pm

    I watch CNBC as often as I can to track the market especially GE. Since GE went into the financial sector @ 49% if its business, it has gone the way the rest of the rest of the financial providers have gone in the last year. Until the global economy stabilizes, I see GE’s numbers staying low and can only hope that the other 51% can keep the company afloat. We are heavily invested in GE and wish it well, but it won’t break my heart if it goes onward toward developing a greater science and technology market and leaves the risky financial ventures to others…
20. JLP says:

    August 26, 2009 at 1:27 pm

    I am thinking of investing in GE, as I am new to buying stocks, what do you think? I’m looking at $5K