Harbor Advisory's Jack De Gan Says GE's Q2 Result 'Better Than I Was Expecting'

Jack De Gan, chief investment officer and principal and senior portfolio advisor at Harbor Advisory appeared on CNBC's Squawk Box to break down GE's

Q2 results.

's Q2 revenue came in at $35.1 billion, a bit under analysts' $35.555 billion estimates. Their EPS came in at $0.36, excluding certain items, slightly over analysts' estimates of $0.35 per share. Before the results came out, De Gan thought that merging markets would give GE more trouble, especially in Brazil and Australia, where there have been weaknesses in their currencies, and was surprised that Q2's results are so high.

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De Gan also noted the shrinkage of GE capital as part of Q2's results. "The quicker that goes down, the better," said De Gan. GE paid back $1.9 billion in dividends for Q2, and $6.5 billion in total for the year. "That's going to go right into their capital allocation plan, which also got the proceeds from the NBC sale. So it's going to allow them to buy back more shares, and will, by the end of the year, be approaching that 10 million share count that we were at in '07," said De Gan. According to De Gan's predictions, another dividend increase will happen in GE's next quarter, from $0.76 to $0.84, slightly over a 10 percent increase. He also reiterated the need for GE to trim the amount of capital it's putting into the company, which will lift the multiple. Part of GE's bump in Q2 had to do with the company taking a strong shift of focus back to their industrial side, including aviation and oil and gas. "The backlog of commercial airplane deliveries is absolutely enormous, and GE has got engines there, and we know the oil and gas boom in the U.S. is enormous and will last decades," said De Gan.