"They don't get much more blue-chip than General Electric (NYSE: GE)," says Nilus Mattive. I his top-notch Dividend Superstars, he takes a look at the industrial gain which offers an indicated yield of 4.4%.
"GE is the only company that has remained in the Dow Jones Industrial Average from day one, the company was founded in 1890 by none other than Thomas Alva Edison to market his various inventions.
"GE's broad diversification is both a blessing and a curse. On one hand, it affords the firm plenty of protection from a major decline in any one business.
"On the other, it has led to a very complicated enterprise with inherently limited growth prospects. Yet despite the company's size, it has still managed to increase its revenues internally by about 9% a year.
"Currently, only about 10% of GE's revenues are derived in Asia, but the company is rapidly trying to expand its presence in fast-growing economies like China. I think there is tremendous growth potential there, particularly for GE's infrastructure business.
"The company has been paying a dividend in each quarter for more than a century, and it has raised its payment for 32 years consecutively.
The market has really been neglecting this stock lately, pushing GE down to multi-year lows. I believe investors are worried (rightly) that the company's consumer finance services business could see
additional weakness in the short-term.
"However, other parts of GE can more than offset problems in a segment or two. Bottom line: I think there's a huge opportunity for long-term income investors to scoop up these blue chip shares at a very attractive price."
Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.
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Reader Comments (Page 1 of 1)
7-08-2008 @ 11:04AM
Sheldon L said...
I agree that the long term upside potential yield out ways any downside over the next six to nine months.
7-08-2008 @ 4:02PM
Dick Marcoux said...
I've read so many blogs about GE like yours, that sometimes I think you people are working out of GE's office. Are you? I'm a GE shareholder - 27,000 shares - since 1984, so I've experienced a lot with them...and the best was with Jack Welch. The worst, obviously, has been with Jeff Immelt. Since he took over 7 years ago, GE stock is down almost 30%. So, if you want to blog about something, blog about his lousy performance.
7-09-2008 @ 10:33AM
Bruce E Warnock said...
We are also GE shareholders and look back sadly at the year 2000 and GE at $60. Jeff Immelt has long outlived his welcome and the Board needs to install new leadership at the top.
While they are at it, the Board needs to separate the positions of CEO and Chairman of the Board, so at least the new CEO will have a "boss" to report to. The Board needs to assert itself and set overall policy, not leaving this to the CEO.
GE is a great company that will rebound when they go back to what made them great. Jack Welch would not have tolerated the performance of GE under the leadership of Immelt. Show him the door and the sooner the better.