Market Overview

Jeff Immelt's Legacy, Or Lack Thereof

Jeff Immelt's Legacy, Or Lack Thereof

Jeff Immelt took over the top ranks at General Electric Company (NYSE: GE) back in 2001 and replaced one of the most notable executive leaders of all time, Jack Welch. On Monday, it was announced that Immelt will be resigning but will he be leaving with a legacy of success?

Since taking over as CEO of GE, the stock has actually lost 30 percent of its value, which makes it the worst Dow component, CNBC's Jim Cramer noted during Monday's "Squawk on the Street" segment. Meanwhile, some of GE's most comparable peers such as United Technologies Corporation (NYSE: UTX) and Honeywell International Inc. (NYSE: HON) rewarded their investors with a more than 200-percent return over the same time period.

The fact is management teams at United Technologies and Honeywell were better at reshuffling their portfolios in ways that generated a much better return. As such, the time for a CEO change is now and perhaps the company even sped up the review process especially after recent disappointments.

For instance, GE's cash flow in the first quarter was "abysmal," Cramer continued. In fact, the company's first quarter turned many investors to become not only negative but also "fearful."

Also, some of Wall Street's most notable analysts started to shy away from the stock, including Deutsche Bank's John Inch who downgraded the stock from Hold to Sell with a price target lowered from $28 to $24.

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Image Credit: By WRI Staff - Jeffrey Immelt (Chairman and C.E.O., General Electric), CC BY 2.0, via Wikimedia Commons


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Posted-In: CNBC Jack Welch Jeff Immelt Squawk on the Street Jim CramerNews Management Media Best of Benzinga

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