Market Overview

Sell-Side Analysts Respond To GE's Earnings Sell-Off

Share:
Sell-Side Analysts Respond To GE's Earnings Sell-Off
Related GE
Jim Cramer's Ways To Spot A Dividend Cut Coming
General Electric's Liquidity Problem
GE 'not inexpensive given leverage profile' as Goldman cuts price target (Seeking Alpha)

General Electric Company (NYSE: GE) stock is down more than 5 percent since reporting its second-quarter earnings numbers last week. Analysts still see a tough road ahead for GE and its investors, but some are surprised at the severity of the sell-off.

Argus Downgrade

Argus analyst John Eade in a July 20 note had some positive things to say about GE as a potential long-term value play, but he downgraded the stock from Buy to Hold and said it’s too early for investors to be betting on a recovery.

Eade said the company’s Q2 report showed there’s still a lot of work to be done at GE and management may have a difficult time clearing the low earnings expectations bar throughout the rest of the year. Argus lowered its 2018 EPS forecast from $1.03 to 97 cents.

“We will need to see stronger order trends at a minimum, and most likely at least two quarters of progress before reconsidering a BUY rating,” Eade said.

Deutsche Bank Surprised

On Sunday, Deutsche Bank analyst Nicole DeBlase said the severity of Friday’s sell-off caught her off guard.

“GE reported a penny beat this quarter, and following a series of negative catalysts over the past 12 months, we thought a modest beat and generally unchanged commentary might be received less negatively by the market - we were surprised by the magnitude of the sell-off (-4%),” DeBlase said in a note.

She reiterated her Hold rating and $15 price target for the stock, but increased her full-year EPS estimate from 98 cents to 99 cents.

DeBlase speculated investors were disappointed that GE didn’t go ahead and lower full-year guidance and instead chose to leave that negative near-term catalyst hanging over the stock.

While Q2 results weren’t bad in her eyes, DeBlase said there’s simply not enough upside at the moment to recommend investors buy GE stock.

Price Action

GE stock declined 1 percent Monday to the $12.98 area and is now down 50 percent in the past year.

Related Links:

Oppenheimer Drops Bearish GE Thesis On Improving Balance Sheet Outlook

What DJIA Changes Mean For GE, Walgreens Investors

Image credit: Momoneymoproblemz (Own work) [CC BY-SA 3.0], via Wikimedia Commons

Latest Ratings for GE

DateFirmActionFromTo
Nov 2018CitigroupMaintainsBuyBuy
Oct 2018BarclaysMaintainsOverweightOverweight
Oct 2018Deutsche BankMaintainsHoldHold

View More Analyst Ratings for GE
View the Latest Analyst Ratings

Posted-In: Argus Deutsche Bank John EadeAnalyst Color Downgrades Price Target Top Stories Analyst Ratings Best of Benzinga

 

Related Articles (GE)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
LXFTKeyBancDowngrades0.0
CPAImperial CapitalDowngrades68.0
PRMWImperial CapitalInitiates Coverage On18.0
TGTKeyBancInitiates Coverage On110.0
QCOMMorgan StanleyUpgrades0.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Bringing Some Glamour To Infrastructure ETFs

Sangamo Announces TxCell Acquisition, Patient Dosing In SB-318