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With shares of General Electric (NYSE:GE) trading at around $21.13, is GE an OUTPERFORM, WAIT AND SEE, or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
C = Catalyst for the Stock’s Movement
Since a relatively solid earnings report in October in which guidance was maintained, GE hasn’t been performing very well. Then again, the stock has been holding its own, and with a 3.30% yield, a few hiccups shouldn’t scare you away. Other positive signs include four dividend increases since 2010, a Forward P/E of 12.43, an overall analyst infatuation with the stock (not always a positive), and a company that has decided to go back to the basics, which has led to better results over the past three years.
E = Equity to Debt Ratio is Normal
GE has a debt-to-equity ratio of 2.77. Their cash to long-term debt is also normal for the industry. GE has $134.18 billion in cash and $355.11 billion in debt.
T = Technicals on the Stock Chart Are Strong
As of November 30, GE has stayed on pace with the S&P 500 over the past month. GE has dropped .09% while the S&P 500 has dropped .15%. GE has shown much more impressive numbers over the past few years.
Year-to-date, GE is up 20.95% while the S&P 500 is up 14.43%. Over the past calendar year, GE is up 46.60% while the S&P 500 is up 20.94%. When you look at three-year returns, GE is up 45.54% while the S&P 500 is up 37.58%.
At $21.13 GE is currently trading slightly below of its 50-day SMA and 100-day SMA of $21.75 and $21.24, respectively. It’s trading slightly higher than its 200-day SMA of $20.32.
E = Earnings Are Steady
Earnings have been…
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