GENERAL ELECTRIC (GE) Stock Fundamental Analysis
NYSE:GE - New York Stock Exchange, Inc. - US3696041033 - Common Stock - Currency: USD
Taking everything into account, GE scores 5 out of 10 in our fundamental rating. GE was compared to 66 industry peers in the Aerospace & Defense industry. While GE has a great profitability rating, there are some minor concerns on its financial health. GE is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
GE had positive earnings in the past year.
GE had a positive operating cash flow in the past year.
GE had positive earnings in 4 of the past 5 years.
Each year in the past 5 years GE had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 5.64%, GE is doing good in the industry, outperforming 71.21% of the companies in the same industry.
With an excellent Return On Equity value of 36.34%, GE belongs to the best of the industry, outperforming 98.48% of the companies in the same industry.
With a Return On Invested Capital value of 6.47%, GE perfoms like the industry average, outperforming 59.09% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for GE is significantly below the industry average of 8.47%.
The 3 year average ROIC (3.20%) for GE is below the current ROIC(6.47%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.64% | ||
| ROE | 36.34% | ||
| ROIC | 6.47% |
ROA(3y)3.55%
ROA(5y)1.86%
ROE(3y)22.52%
ROE(5y)13.1%
ROIC(3y)3.2%
ROIC(5y)N/A
1.3 Margins
GE has a Profit Margin of 17.63%. This is amongst the best in the industry. GE outperforms 98.48% of its industry peers.
Looking at the Operating Margin, with a value of 16.35%, GE belongs to the top of the industry, outperforming 87.88% of the companies in the same industry.
GE's Operating Margin has improved in the last couple of years.
The Gross Margin of GE (35.83%) is better than 74.24% of its industry peers.
In the last couple of years the Gross Margin of GE has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.35% | ||
| PM (TTM) | 17.63% | ||
| GM | 35.83% |
OM growth 3Y396.9%
OM growth 5Y30.84%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y18.73%
GM growth 5Y6.44%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so GE is destroying value.
Compared to 1 year ago, GE has less shares outstanding
GE has less shares outstanding than it did 5 years ago.
GE has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.03 indicates that GE is not in any danger for bankruptcy at the moment.
GE has a Altman-Z score of 3.03. This is comparable to the rest of the industry: GE outperforms 45.45% of its industry peers.
The Debt to FCF ratio of GE is 4.44, which is a neutral value as it means it would take GE, 4.44 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.44, GE is in the better half of the industry, outperforming 74.24% of the companies in the same industry.
A Debt/Equity ratio of 0.91 indicates that GE is somewhat dependend on debt financing.
GE has a Debt to Equity ratio of 0.91. This is in the lower half of the industry: GE underperforms 69.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 4.44 | ||
| Altman-Z | 3.03 |
ROIC/WACC0.61
WACC10.66%
2.3 Liquidity
GE has a Current Ratio of 1.08. This is a normal value and indicates that GE is financially healthy and should not expect problems in meeting its short term obligations.
GE has a Current ratio of 1.08. This is amonst the worse of the industry: GE underperforms 81.82% of its industry peers.
GE has a Quick Ratio of 1.08. This is a bad value and indicates that GE is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.77, GE is doing worse than 78.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.77 |
3. Growth
3.1 Past
GE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 54.03%, which is quite impressive.
The Earnings Per Share has been decreasing by -1.65% on average over the past years.
The Revenue has grown by 8.81% in the past year. This is quite good.
The Revenue for GE have been decreasing by -15.57% on average. This is quite bad
EPS 1Y (TTM)54.03%
EPS 3Y28.22%
EPS 5Y-1.65%
EPS Q2Q%81.71%
Revenue 1Y (TTM)8.81%
Revenue growth 3Y-11.83%
Revenue growth 5Y-15.57%
Sales Q2Q%-40.68%
3.2 Future
The Earnings Per Share is expected to grow by 16.46% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.70% on average over the next years. This is quite good.
EPS Next Y27.72%
EPS Next 2Y22.27%
EPS Next 3Y20.29%
EPS Next 5Y16.46%
Revenue Next Year14.17%
Revenue Next 2Y12.4%
Revenue Next 3Y11.31%
Revenue Next 5Y9.7%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 51.02, GE can be considered very expensive at the moment.
The rest of the industry has a similar Price/Earnings ratio as GE.
GE is valuated expensively when we compare the Price/Earnings ratio to 27.50, which is the current average of the S&P500 Index.
GE is valuated quite expensively with a Price/Forward Earnings ratio of 39.22.
The rest of the industry has a similar Price/Forward Earnings ratio as GE.
The average S&P500 Price/Forward Earnings ratio is at 36.44. GE is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 51.02 | ||
| Fwd PE | 39.22 |
4.2 Price Multiples
GE's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GE indicates a somewhat cheap valuation: GE is cheaper than 62.12% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 63.68 | ||
| EV/EBITDA | 37.95 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates GE does not grow enough to justify the current Price/Earnings ratio.
GE has a very decent profitability rating, which may justify a higher PE ratio.
GE's earnings are expected to grow with 20.29% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.84
PEG (5Y)N/A
EPS Next 2Y22.27%
EPS Next 3Y20.29%
5. Dividend
5.1 Amount
GE has a yearly dividend return of 0.57%, which is pretty low.
Compared to an average industry Dividend Yield of 1.19, GE pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.57, GE pays less dividend than the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.57% |
5.2 History
The dividend of GE is nicely growing with an annual growth rate of 9.39%!
GE has paid a dividend for at least 10 years, which is a reliable track record.
GE has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)9.39%
Div Incr Years2
Div Non Decr Years4
5.3 Sustainability
GE pays out 17.50% of its income as dividend. This is a sustainable payout ratio.
The dividend of GE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP17.5%
EPS Next 2Y22.27%
EPS Next 3Y20.29%
263.27
+2.99 (+1.15%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners79.98%
Inst Owner Change0%
Ins Owners0.15%
Ins Owner Change0.53%
Market Cap280.75B
Analysts82.86
Price Target250.86 (-4.71%)
Short Float %1.45%
Short Ratio2.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.57% |
Yearly Dividend0.93
Dividend Growth(5Y)9.39%
DP17.5%
Div Incr Years2
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18.35%
Min EPS beat(2)13.68%
Max EPS beat(2)23.03%
EPS beat(4)3
Avg EPS beat(4)13.3%
Min EPS beat(4)-1.74%
Max EPS beat(4)23.03%
EPS beat(8)7
Avg EPS beat(8)21.19%
EPS beat(12)11
Avg EPS beat(12)35.48%
EPS beat(16)15
Avg EPS beat(16)32.75%
Revenue beat(2)1
Avg Revenue beat(2)-1.05%
Min Revenue beat(2)-2.98%
Max Revenue beat(2)0.87%
Revenue beat(4)1
Avg Revenue beat(4)-2.88%
Min Revenue beat(4)-5.66%
Max Revenue beat(4)0.87%
Revenue beat(8)4
Avg Revenue beat(8)1.15%
Revenue beat(12)4
Avg Revenue beat(12)-19.58%
Revenue beat(16)4
Avg Revenue beat(16)-22.45%
PT rev (1m)6.99%
PT rev (3m)6.8%
EPS NQ rev (1m)-0.2%
EPS NQ rev (3m)6.24%
EPS NY rev (1m)0.57%
EPS NY rev (3m)2.33%
Revenue NQ rev (1m)0.33%
Revenue NQ rev (3m)1.48%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.47%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 51.02 | ||
| Fwd PE | 39.22 | ||
| P/S | 7.08 | ||
| P/FCF | 63.68 | ||
| P/OCF | 53.7 | ||
| P/B | 14.58 | ||
| P/tB | 44.72 | ||
| EV/EBITDA | 37.95 |
EPS(TTM)5.16
EY1.96%
EPS(NY)6.71
Fwd EY2.55%
FCF(TTM)4.13
FCFY1.57%
OCF(TTM)4.9
OCFY1.86%
SpS37.21
BVpS18.05
TBVpS5.89
PEG (NY)1.84
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.64% | ||
| ROE | 36.34% | ||
| ROCE | 7.28% | ||
| ROIC | 6.47% | ||
| ROICexc | 7.62% | ||
| ROICexgc | 9.19% | ||
| OM | 16.35% | ||
| PM (TTM) | 17.63% | ||
| GM | 35.83% | ||
| FCFM | 11.11% |
ROA(3y)3.55%
ROA(5y)1.86%
ROE(3y)22.52%
ROE(5y)13.1%
ROIC(3y)3.2%
ROIC(5y)N/A
ROICexc(3y)3.81%
ROICexc(5y)N/A
ROICexgc(3y)4.52%
ROICexgc(5y)N/A
ROCE(3y)3.6%
ROCE(5y)N/A
ROICexcg growth 3Y385.39%
ROICexcg growth 5Y24.01%
ROICexc growth 3Y412.86%
ROICexc growth 5Y26.63%
OM growth 3Y396.9%
OM growth 5Y30.84%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y18.73%
GM growth 5Y6.44%
F-Score6
Asset Turnover0.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 4.44 | ||
| Debt/EBITDA | 2.35 | ||
| Cap/Depr | 85.31% | ||
| Cap/Sales | 2.06% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 70.18% | ||
| Profit Quality | 63.03% | ||
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.77 | ||
| Altman-Z | 3.03 |
F-Score6
WACC10.66%
ROIC/WACC0.61
Cap/Depr(3y)67.38%
Cap/Depr(5y)59.46%
Cap/Sales(3y)3.4%
Cap/Sales(5y)2.98%
Profit Quality(3y)3112.18%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)54.03%
EPS 3Y28.22%
EPS 5Y-1.65%
EPS Q2Q%81.71%
EPS Next Y27.72%
EPS Next 2Y22.27%
EPS Next 3Y20.29%
EPS Next 5Y16.46%
Revenue 1Y (TTM)8.81%
Revenue growth 3Y-11.83%
Revenue growth 5Y-15.57%
Sales Q2Q%-40.68%
Revenue Next Year14.17%
Revenue Next 2Y12.4%
Revenue Next 3Y11.31%
Revenue Next 5Y9.7%
EBIT growth 1Y61.62%
EBIT growth 3Y338.1%
EBIT growth 5Y10.46%
EBIT Next Year36.34%
EBIT Next 3Y19.37%
EBIT Next 5Y13.76%
FCF growth 1Y-8.05%
FCF growth 3Y23.11%
FCF growth 5Y-10.02%
OCF growth 1Y-15.88%
OCF growth 3Y12.23%
OCF growth 5Y-11.62%