Stock Update (NYSE:GE): General Electric Company Signs Agreement with Jamaica Public Service Company


General Electric Company (NYSE:GE) has signed an agreement with the integrated electric utility company, Jamaica Public Service Company, Limited (JPS), to modernize its generation equipment and provide its service expertise at the Bogue Power Station in Montego Bay, Jamaica.

“2016 marked a turning point for Jamaica. After more than a decade of preparation and planning, natural gas was finally introduced into the fuel mix for electricity generation in the country, and as the sole distributor of electricity in Jamaica, we see the use of liquified natural gas (LNG) as resulting in greater stability in the price of electricity for our customers,” said Joseph Williams, senior vice president of generation, JPS. “By replacing a 19-year old unit with GE’s advanced aeroderivative technology, we will be able to deliver more efficient power to our people, businesses and critical facilities. Providing sufficient, efficient and reliable power to our customers is essential, as it helps to improve lives and drive development.”

JPS, with responsibility for generation, transmission and distribution on the island, recently introduced LNG into its fuel mix. This began with the dual-fuel conversion of its 120-megawatt (MW) combined-cycle Bogue Power Station. Now, with the installation of one of GE’s LM2500+ aeroderivative gas turbines at the Bogue plant, LNG-fueled generation will contribute up to approximately 15 percent of JPS’ total power production. This will result in both environmental and financial benefits, including improved operations and maintenance costs.

Repowering with GE’s LM2500+ aeroderivative gas turbine package will enable a power output increase of 20 megawatts (MW) at the plant, which will positively impact service reliability on the island. In addition to the unit, GE will provide associated installation services as well as inspection services to the existing Brush generator. The LM2500+ product family has been a proven technology for decades and has achieved more than 90 million operating hours with more than 2,100 units deployed globally.

“We have a long and comprehensive history with JPS, having supported the utility on power generation, transmission and distribution and lighting projects for the past 40 years. At Power Services, for example, we have provided maintenance support for equipment at three of JPS’ power stations,” said Ramon Paramio, general manager for Latin America, GE’s Power Services business. “With this latest project, we are working with JPS to bring more diversification to Jamaica’s power mix while also helping to increase the utility’s generation capabilities.”

Over the years, GE has provided support at JPS’ Bogue, Old Harbour and Hunt’s Bay power stations. Recent projects include the addition of an inlet cooling system at the Bogue facility (in 2008) and a dual fuel conversion at the power station (in 2016). Modernizations like these have helped JPS better meet the needs of its more than 600,000 customers. The utility owns and operates four power stations, nine hydroelectric plants, 43 substations and approximately 14,000 kilometers of transmission and distribution lines.

This latest upgrade project is expected to be complete within the first half of 2018.

Shares of General Electric closed yesterday at $20.16, down $-0.25 or -1.22%. GE has a 1-year high of $32.38 and a 1-year low of $20.05. The stock’s 50-day moving average is $23.49 and its 200-day moving average is $26.09.

On the ratings front, General Electric has been the subject of a number of recent research reports. In a report released today, J.P. Morgan analyst Stephen Tusa maintained a Sell rating on GE, with a price target of $17, which reflects a potential downside of -16% from last closing price. Separately, on October 30, Deutsche Bank’s John G. Inch reiterated a Sell rating on the stock and has a price target of $18.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Stephen Tusa and John G. Inch have a yearly average return of 7.9% and 13.2% respectively. Tusa has a success rate of 75% and is ranked #762 out of 4699 analysts, while Inch has a success rate of 79% and is ranked #728.

Sentiment on the street is mostly neutral on GE stock. Out of 13 analysts who cover the stock, 5 suggest a Hold rating , 4 suggest a Sell and 4 recommend to Buy the stock. The 12-month average price target assigned to the stock is $23.67, which represents a potential upside of 17% from where the stock is currently trading.

 

  • Clayton, Dubilier, and Rice recently fired the CEO of Brand Energy. That was a good move. They need to finish the job by getting rid of all the ex-GE people that the CEO brought in with him. Brand Energy recently merged with Safway.

    Clayton shouldn’t let Brand executives waste money on golf tournaments and useless trips. The ex-CEO and his gang did a lot of that. They said it was for charity but it was a waste of Clayton’s money. Clayton should make the ex-CEO and Brand executives reimburse them for all past trips and expenses. That means all airfare, hotel, and other expenses for past trips should be paid back to Clayton. The ex-GE guy in Houston who was called President of Business Development should definitely have to pay Clayton back since he was a big part of those golf tournaments and events which wasted company money. He has the polish-looking last name. They had to keep him on the road all the time because he didn’t get along with anyone. Can you imagine how much that cost the company? Clayton should do a detailed investigation and accounting of those trips and tournaments. Don’t let Brand executives hide behind the “charity” excuse.

    Clayton, Dubilier, and Rice is a PE firm very similar to KKR. They own Brand Energy. CHC Helicopter was turned around but Brand wasn’t. That’s because the CEO of Brand was too busy bringing in his friends and not firing them no matter what. That’s not how you run a company. CHC’s turnaround shows that Clayton needs to recover money from the ex-CEO, the ex-GE guy in Houston, and the rest of the gang at Brand immediately.