GENERAL ELECTRIC (GE) Stock Fundamental Analysis
NYSE:GE - New York Stock Exchange, Inc. - US3696041033 - Common Stock - Currency: USD
GE gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 64 industry peers in the Aerospace & Defense industry. While GE has a great profitability rating, there are quite some concerns on its financial health. While showing a medium growth rate, GE is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
GE had positive earnings in the past year.
In the past year GE had a positive cash flow from operations.
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
GE has a Return On Assets of 5.64%. This is in the better half of the industry: GE outperforms 67.19% of its industry peers.
With an excellent Return On Equity value of 36.34%, GE belongs to the best of the industry, outperforming 98.44% of the companies in the same industry.
The Return On Invested Capital of GE (6.47%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for GE is below the industry average of 7.94%.
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
With an excellent Profit Margin value of 17.63%, GE belongs to the best of the industry, outperforming 96.88% of the companies in the same industry.
GE has a better Operating Margin (16.35%) than 87.50% of its industry peers.
GE's Operating Margin has improved in the last couple of years.
GE's Gross Margin of 35.83% is fine compared to the rest of the industry. GE outperforms 71.88% of its industry peers.
GE's Gross Margin has improved in the last couple of years.
| 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
Compared to 5 years ago, GE has less shares outstanding
GE has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.88 indicates that GE is not a great score, but indicates only limited risk for bankruptcy at the moment.
GE has a Altman-Z score of 2.88. This is comparable to the rest of the industry: GE outperforms 48.44% of its industry peers.
GE has a debt to FCF ratio of 4.44. This is a neutral value as GE would need 4.44 years to pay back of all of its debts.
GE's Debt to FCF ratio of 4.44 is fine compared to the rest of the industry. GE outperforms 78.13% of its industry peers.
GE has a Debt/Equity ratio of 0.91. This is a neutral value indicating GE is somewhat dependend on debt financing.
The Debt to Equity ratio of GE (0.91) is worse than 70.31% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 4.44 | ||
| Altman-Z | 2.88 |
ROIC/WACC0.64
WACC10.13%
2.3 Liquidity
A Current Ratio of 1.08 indicates that GE should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.08, GE is doing worse than 82.81% of the companies in the same industry.
A Quick Ratio of 0.77 indicates that GE may have some problems paying its short term obligations.
GE's Quick ratio of 0.77 is on the low side compared to the rest of the industry. GE is outperformed by 81.25% of its industry peers.
| 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.
Looking at the last year, GE shows a quite strong growth in Revenue. The Revenue has grown by 8.81% in the last year.
GE shows a very negative growth in Revenue. Measured over the last years, the Revenue has been decreasing by -15.57% yearly.
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
GE is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.13% yearly.
The Revenue is expected to grow by 9.14% on average over the next years. This is quite good.
EPS Next Y26.99%
EPS Next 2Y21.93%
EPS Next 3Y20.13%
EPS Next 5Y15.13%
Revenue Next Year14.26%
Revenue Next 2Y12.35%
Revenue Next 3Y11.42%
Revenue Next 5Y9.14%
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 45.26, GE can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of GE is on the same level as its industry peers.
GE is valuated expensively when we compare the Price/Earnings ratio to 26.03, which is the current average of the S&P500 Index.
GE is valuated quite expensively with a Price/Forward Earnings ratio of 34.99.
GE's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.94, GE is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.26 | ||
| Fwd PE | 34.99 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GE is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, GE is valued a bit cheaper than 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 56.49 | ||
| EV/EBITDA | 34.37 |
4.3 Compensation for Growth
GE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
GE has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as GE's earnings are expected to grow with 20.13% in the coming years.
PEG (NY)1.68
PEG (5Y)N/A
EPS Next 2Y21.93%
EPS Next 3Y20.13%
5. Dividend
5.1 Amount
GE has a yearly dividend return of 0.63%, which is pretty low.
GE's Dividend Yield is a higher than the industry average which is at 1.34.
With a Dividend Yield of 0.63, GE pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
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
17.50% of the earnings are spent on dividend by GE. This is a low number and sustainable payout ratio.
The dividend of GE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP17.5%
EPS Next 2Y21.93%
EPS Next 3Y20.13%
233.54
-1.72 (-0.73%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners80.08%
Inst Owner Change-0.36%
Ins Owners0.17%
Ins Owner Change0.31%
Market Cap249.04B
Analysts84.83
Price Target229.45 (-1.75%)
Short Float %1.17%
Short Ratio2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.63% |
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)-2.31%
PT rev (3m)-0.7%
EPS NQ rev (1m)5.84%
EPS NQ rev (3m)5.81%
EPS NY rev (1m)1.99%
EPS NY rev (3m)1.86%
Revenue NQ rev (1m)0.83%
Revenue NQ rev (3m)1.04%
Revenue NY rev (1m)0.55%
Revenue NY rev (3m)0.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.26 | ||
| Fwd PE | 34.99 | ||
| P/S | 6.28 | ||
| P/FCF | 56.49 | ||
| P/OCF | 47.64 | ||
| P/B | 12.94 | ||
| P/tB | 39.67 | ||
| EV/EBITDA | 34.37 |
EPS(TTM)5.16
EY2.21%
EPS(NY)6.68
Fwd EY2.86%
FCF(TTM)4.13
FCFY1.77%
OCF(TTM)4.9
OCFY2.1%
SpS37.21
BVpS18.05
TBVpS5.89
PEG (NY)1.68
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 | 2.88 |
F-Score6
WACC10.13%
ROIC/WACC0.64
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 Y26.99%
EPS Next 2Y21.93%
EPS Next 3Y20.13%
EPS Next 5Y15.13%
Revenue 1Y (TTM)8.81%
Revenue growth 3Y-11.83%
Revenue growth 5Y-15.57%
Sales Q2Q%-40.68%
Revenue Next Year14.26%
Revenue Next 2Y12.35%
Revenue Next 3Y11.42%
Revenue Next 5Y9.14%
EBIT growth 1Y61.62%
EBIT growth 3Y338.1%
EBIT growth 5Y10.46%
EBIT Next Year34.71%
EBIT Next 3Y19.28%
EBIT Next 5Y13.87%
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%