GENERAL ELECTRIC (GE) Stock Fundamental Analysis
NYSE:GE - New York Stock Exchange, Inc. - US3696041033 - Common Stock - Currency: USD
Overall GE gets a fundamental rating of 5 out of 10. We evaluated GE against 65 industry peers in the Aerospace & Defense industry. GE has an excellent profitability rating, but there are 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.
GE had a positive operating cash flow in the past year.
GE had positive earnings in 4 of the past 5 years.
GE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
GE has a better Return On Assets (5.64%) than 70.77% of its industry peers.
The Return On Equity of GE (36.34%) is better than 98.46% of its industry peers.
With a Return On Invested Capital value of 6.47%, GE perfoms like the industry average, outperforming 58.46% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GE is significantly below the industry average of 8.39%.
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
The Profit Margin of GE (17.63%) is better than 98.46% of its industry peers.
With an excellent Operating Margin value of 16.35%, GE belongs to the best of the industry, outperforming 87.69% of the companies in the same industry.
GE's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 35.83%, GE is doing good in the industry, outperforming 73.85% of the companies in the same industry.
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
GE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
GE has less shares outstanding than it did 1 year ago.
GE has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, GE has a worse debt to assets ratio.
2.2 Solvency
GE has an Altman-Z score of 2.98. This is not the best score and indicates that GE is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of GE (2.98) is comparable to the rest of the industry.
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 has a better Debt to FCF ratio (4.44) than 73.85% of its industry peers.
A Debt/Equity ratio of 0.91 indicates that GE is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.91, GE is not doing good in the industry: 70.77% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.91 | ||
| Debt/FCF | 4.44 | ||
| Altman-Z | 2.98 |
ROIC/WACC0.63
WACC10.3%
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 83.08% 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 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.77 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 54.03% over the past year.
GE shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -1.65% yearly.
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 15.90% yearly.
GE is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.30% yearly.
EPS Next Y26.99%
EPS Next 2Y21.93%
EPS Next 3Y20.13%
EPS Next 5Y15.9%
Revenue Next Year14.12%
Revenue Next 2Y12.21%
Revenue Next 3Y11.23%
Revenue Next 5Y9.3%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
GE is valuated quite expensively with a Price/Earnings ratio of 46.90.
The rest of the industry has a similar Price/Earnings ratio as GE.
The average S&P500 Price/Earnings ratio is at 26.59. GE is valued rather expensively when compared to this.
With a Price/Forward Earnings ratio of 36.25, GE can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GE is on the same level as its industry peers.
GE is valuated expensively when we compare the Price/Forward Earnings ratio to 22.39, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 46.9 | ||
| Fwd PE | 36.25 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as GE.
GE's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. GE is cheaper than 61.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 58.53 | ||
| EV/EBITDA | 36.69 |
4.3 Compensation for Growth
The 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.
GE's earnings are expected to grow with 20.13% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.74
PEG (5Y)N/A
EPS Next 2Y21.93%
EPS Next 3Y20.13%
5. Dividend
5.1 Amount
With a yearly dividend of 0.57%, GE is not a good candidate for dividend investing.
GE's Dividend Yield is a higher than the industry average which is at 1.29.
With a Dividend Yield of 0.57, GE pays less dividend than the S&P500 average, which is at 2.39.
| 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 2Y21.93%
EPS Next 3Y20.13%
242
-9.41 (-3.74%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners80.08%
Inst Owner Change-0.34%
Ins Owners0.17%
Ins Owner Change0.46%
Market Cap258.07B
Analysts82.76
Price Target234.48 (-3.11%)
Short Float %1.32%
Short Ratio2.15
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)2.67%
PT rev (3m)0.79%
EPS NQ rev (1m)0.58%
EPS NQ rev (3m)6.48%
EPS NY rev (1m)1.99%
EPS NY rev (3m)1.74%
Revenue NQ rev (1m)0.32%
Revenue NQ rev (3m)1.39%
Revenue NY rev (1m)-0.13%
Revenue NY rev (3m)0.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 46.9 | ||
| Fwd PE | 36.25 | ||
| P/S | 6.5 | ||
| P/FCF | 58.53 | ||
| P/OCF | 49.36 | ||
| P/B | 13.41 | ||
| P/tB | 41.11 | ||
| EV/EBITDA | 36.69 |
EPS(TTM)5.16
EY2.13%
EPS(NY)6.68
Fwd EY2.76%
FCF(TTM)4.13
FCFY1.71%
OCF(TTM)4.9
OCFY2.03%
SpS37.21
BVpS18.05
TBVpS5.89
PEG (NY)1.74
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 | 2.98 |
F-Score6
WACC10.3%
ROIC/WACC0.63
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 5Y15.9%
Revenue 1Y (TTM)8.81%
Revenue growth 3Y-11.83%
Revenue growth 5Y-15.57%
Sales Q2Q%-40.68%
Revenue Next Year14.12%
Revenue Next 2Y12.21%
Revenue Next 3Y11.23%
Revenue Next 5Y9.3%
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%