Is GE Worth a Penny?
The stock market world is abuzz this morning because GE cut its dividend to 1 cent and earnings weren't great.
Here's the ugly 30-year chart:
I find this interesting for a couple reasons.
One, back when I was graduating engineering school circa 2000 I interviewed with GE Medical Systems. Part of their compensation pitch was company stock purchase plans. The guy doing the presentation actually told us that the stock had gone up 15% per year forever and was a big factor that we should think about if we were to work for GE.
Two, the company still made a couple billion dollars. Earnings per share were 0.14. That's above zero! Yes, cutting dividends isn't a good sign, but at the same time, the valuations on companies that are burning money in bright bonfires are higher than a company that has been around for a century and actually makes money on average.
I know, I know. You pay for growth. Those eyeballs will turn into revenue... somehow! Someday! Blah, blah, blah.
Gotta Love GE price movement preceding the last two crashes as well. Doesn’t look good right now and need to bounce and take back the 200 day MA!!
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Yeah, it's a decent bellwether since they are involved in so many sectors of the economy.
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