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General Electric Shares Rise on Tentative Sign of Turnaround in Q4

Investing.com - Shares in General Electric (NYSE:GE) rose slightly after its fourth-quarter report showed the

Investing.com - Shares in General Electric (NYSE:GE) rose slightly after its fourth-quarter report showed the seeds of a turnaround at the once-mighty conglomerate under new chief executive Larry Culp.

Adjusted free cash flows at its industrial units rebounded strongly to $4.85 billion in the three months to December. While that's still down nearly 30% from last year, the company had had negative free cash flow over the first three quarters of 2018.

GE's overall revenue came in $33.2 billion, slightly ahead of forecasts, but earnings per share fell short at 17c, compared to a 22c consensus. The company had reported EPS of $0.14 on revenue of $29.57B in the previous quarter.

“Our strategy is clear: de-leverage our balance sheet and strengthen our businesses, starting with Power, " Culp said in a statement. "We have more work to do, but I’m
encouraged by the changes we’re making."

GE took a $22 billion charge in the third quarter to address problems at its power division, which has suffered from global overcapacity since the financial crisis. The division's loss widened in the fourth quarter to $872 million from around $600 million three months earlier. Improved earnings at other key divisions such as aviation and oil and gas helped soften the blow.

GE said it sold another $8 billion of assets in the last three months of 2018, making a total of $15 billion in disposals over the year. That helped it to pay down a total of $21 billion in debt over 2018.

GE’s shares showed signs of bottoming out at the end of last year after falling over 75% in the previous two years. They’ve risen nearly 30% from their December low of $7.01, and they rose another 2.2% in premarket trade after the release.

General Electric follows other major Capital Goods sector earnings this month


On Wednesday, Boeing reported fourth quarter EPS of $5.48 on revenue of $28.34B, compared to forecasts of EPS of $4.57 on revenue of $26.88B.

3M earnings beat analyst's expectations on Tuesday, with fourth quarter EPS of $2.31 on revenue of $7.95B. Investing.com analysts expected EPS of $2.28 on revenue of $7.87B

Stay up-to-date on all of the upcoming earnings reports by visiting Investing.com's earnings calendar