Industrial goods manufacturer General Electric Company (NYSE:GE) is undergoing a massive restructuring program in order to create a simpler and nimbler firm with a re-focus on core operations. In addition to the sale of over 4,400 commercial real estate properties of GE Capital Real Estate, GE has vouched to divest most of the financial units under GE Capital over the next 24 months.
However, for a company as large as GE, additional revenues needed for growth are quite large, posing a challenge in developing businesses on such a vast scale. As two important milestones, including the acquisition of French conglomerate Alstom’s energy assets and the pending complete spin-off of its consumer-lending arm Synchrony Financial is nearing conclusion, investors have been eagerly waiting for the company’s latest earnings report. In the last four trailing quarters, GE has reported a positive average earnings surprise of 1.91%, beating the estimates thrice.
Earnings estimate revisions have moved south in the last month on apprehensions and uncertainty regarding both operational and execution risks. Currently, GE has a Zacks Rank #3 (Hold), but that could definitely change following its earnings report, which was just released. We have highlighted some of the key stats from this just-revealed announcement below:
Earnings: GE beat on operating earnings by a whisker. The Zacks Consensus Estimate called for EPS of 30 cents, and the company reported operating EPS (excluding one-time items) of 31 cents
Revenue: Revenues missed. GE posted revenues of $33,104 million, compared with Zacks Consensus Estimate of $34,424 million.
Key Stats to Note: 2015 has been termed as a pivotal year for GE as it renews the strategic aim to establish itself as a manufacturing-based entity with emphasis on big-ticket items such as aviation engines, drilling machines, generators, medical equipment and scanners. Consequently, the future quarters are likely to script a new history for the company.
Stock Price: Shares fell in pre-market trading following the release as investors probably expected a healthy beat in earnings.