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GM And GE: Will Revitalization Efforts Pay Out In Earnings?

GM And GE: Will Revitalization Efforts Pay Out In Earnings?
  • Upcoming earnings highlights include the latest results from two old-school giants striving to improve their prospects.
  • Wall Street analysts are looking for earnings growth from just one of them.
  • However, both have handily bested earnings expectations in recent quarters.

The new earnings season is underway, and among the highlights this week will be the first-quarter results from old-school giants General Electric Company (NYSE: GE) and General Motors Company (NYSE: GM), which each have made efforts in the past few years to become leaner and more disciplined to turn their fortunes around.

Wall Street analysts expect soft results from the energy and transportation conglomerate, judging by the consensus forecast. The numbers for the Detroit automaker are predicted to be better, at least on the bottom line. While both companies have handily bested earnings expectations in recent quarters, the current estimates have been slipping.

Below is a quick look at what analysts expect from these two reports, followed by a glance at some of the other most prominent earnings reports out later this week.

General Electric

Wall Street's consensus forecast for this maker of everything from MRI systems to locomotives to wind turbines calls for earnings per share (EPS) to have slipped by a penny from the same period of last year to $0.19. Yet the consensus of 48 Estimize respondents sees a penny per share gain for the quarter. Either way, it would be the lowest quarterly earnings in the past year.

Estimize predicts that revenue for the quarter will total nearly $28.82 billion, which would be around 2 percent lower than in the year-ago period. Wall Street is slightly more pessimistic, with its consensus forecast set at $27.78 billion on last look. GE is scheduled to report before the opening bell on Friday.

Related Link: Will Intel And Microsoft Top Earnings Expectations Again?

General Motors

When this maker of Chevys, Cadillacs and other car brands shares its results early Thursday, the Wall Street forecast is that it will post EPS of $1.01 for the most recent quarter. That would be up from $0.86 per share year over year. The consensus expectations of 18 Estimize respondents have EPS at $1.05. Note that both Wall Street and Estimize have underestimated earnings in the past three periods.

Revenue for the three months that ended in March will total $35.75 billion, which would be fractionally higher year-over-year, if the Wall Street analysts are correct. The Estimize estimate is $36.57 billion, and Estimize, like Wall Street, underestimated revenue in the previous period, ending several quarters of overestimates.

And Others

Other companies that Wall Street analysts expect to show at least some earnings growth when they report later this week include Alphabet (Google), Intel, McDonald's, Microsoft, Southwest Airlines, Starbucks and Verizon. On the other hand, EPS at American Airlines, American Express, Caterpillar, Coca-Cola and Yahoo will be smaller than a year ago, if the consensus forecasts are correct.

In the following week, the new earnings season ramps up, with results expected from Apple, AT&T, Boeing, Comcast, eBay, Eli Lilly, Exxon Mobil, Facebook, Ford, Marriott, Procter & Gamble, 3M, Xerox and many more.

Disclosure: At the time of this writing, the author had no position in the mentioned equities.


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