Sunday, 18 December 2011

GE Update: Double digit earnings growth in 2012!

Well, quite a few articles doing the rounds suggesting that the US might be the place to be invested in for 2012 but then again it seems that anywhere would be better than the Eurozone.
GE is also getting quite a bit of press suggesting that a comfortable increase to the dividend might take place which could give it a 5% yield v. a share price of $16.61.
This would be largely dependent upon GE Capital paying the parent company a dividend which is up for debate amongst investors as its probability ( General Electric Dividend Yield May Top 5% in 2012: Analyst (Update 1).).

Elsewhere, more fundamental, and more probable is the recent communication by the company's CEO, Jeff Immelt, that GE is looking to achieve a double digit increase to earnings in 2012, against sales growth of 5%, as it shifts focus to material costs, reducing development lead times and reducing exposure to Europe.

All sounds positive and it is good to hear the CEO of a major, major company like GE coming out and talking up the company's prospects over the next 12 months despite all the despondency and inadequacy around Europe's politicians to take a leading step in any direction other than one that satisfies their personal goals.

Anyway, brought into the portfolio in September in place of a poorly performing Cisco, the investment in GE is currently up by 11.8% with a further 0.8% coming from a first dividend, 12.6% in total. Not too shabby for 3 months ownership and could be plenty to look forward to if the CEO's confidence is anything to go by.

Related articles:
- GE sees 2012 profit up by double-digits

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