General Electric Co. (NYSE: GE) may be close to selling its rail car leading division to GATX Corp. (NYSE: GMT). According to Bloomberg, GATX plans to "invest more aggressively" during a financial slowdown.
While the unloading of the division may help GE begin its process of moving slow-growing divisions out of its portfolio, it is likely to be seen on Wall Street as a minor deal and part of a process that is taking much to long. GE has several much larger businesses that drag on its earnings. Those include NBC Universal, the company's industrial division, and its medical supply operations.
GE's resistance to act more quickly to divest operations that no longer help accelerate EPS growth is one of the great business mysteries of the last four or five year. The company's stock still trades well below its 52-week high of $42.15.
GE knows what Wall Street wants, but it appears that the company simply does not care.
Douglas A. McIntyre is an editor at 24/7 Wall St.
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Reader Comments (Page 1 of 1)
8-11-2008 @ 6:37AM
Robert Alexander said...
Sometimes Wall Street is wrong and does not do what is in the best interests of either individual companies or the people of the nation. The courage to do something innovative and different is the only way progress is ever made. If we always stay the course, nothing changes and no improvements are made in anything. For change we can believe in we must be willing to do things differently. Every manufacture in t he USA needs to restore production of "Made in the USA" to its former proud position in world markets. Energy efficient vehicles is a good place to begin. Detroit needs to get off the SUV cow and build the vehicles the world needs and will buy. Their resistance to change is the very reason they are nearly bankrupt today. They should have bucked Wall Street ten years ago and stuck with the development of efficient electric vehicles that they ditched without every perfecting them. Barack Obama has a plan that includes incentives for companies to innovate, and build new vehicles, energy plants and systems to make us independent of the likes of Chavez, Ben Laden, The Royal Families of the Middle East and Russia along with Big Oil. Yes, we can produce our way out of recession, pollution, and high fuel prices by improving what is "Made in the USA".