I estimate that General Electric Company (NYSE: GE)'s Commercial Finance segment is worth between $33.3 billion and $49.8 billion -- 23.4% below last July at the low end -- when compared to $43.5 billion and $64.1 billion.

GE's Commercial Finance offers loans, leases, and other financial services to manufacturers, distributors, and end-users for a variety of equipment and major capital assets. These assets include industrial-related facilities and equipment; commercial and residential real estate; vehicles; corporate aircraft; and equipment used in the construction, manufacturing, telecommunications, and health care industries.

GE Commercial Finance had a strong 2007. Its revenues and net earnings increased 11% and 14%, respectively, compared with 2006. Revenues in 2007 and 2006 included $2.4 billion and $0.1 billion from acquisitions, respectively, and in 2007 were reduced by $2.7 billion as a result of dispositions. Revenues in 2007 also increased $3.7 billion as a result of organic revenue growth ($2.7 billion) and the weaker U.S. dollar ($1.0 billion).

I estimate that General Electric Company's (NYSE: GE) Commercial Finance segment is worth between $43.5 billion and $64.1 billion.

GE's Commercial Finance segment, which constituted 14.6%, 14.0%, and 14.5% of GE's consolidated revenues in 2006, 2005, and 2004, respectively, offers loans, leases, and other financial services to manufacturers, distributors, and end-users for a variety of equipment and major capital assets. These assets include industrial-related facilities and equipment; commercial and residential real estate; vehicles; corporate aircraft; and equipment used in the construction, manufacturing, telecommunications, and health care industries.

GE Commercial Finance looks to me like it's benefiting from the surge in orders for GE Infrastructure.commercial finance profits were up 18% in the second quarter. While developing countries use GE Commercial Finance to purchase capital equipment, the risk in this business is in lending to commercial and residential real estate which seems far from bottoming out.

Assuming that GE Commercial Finance generates net income of $4.5 billion in 2007, here are the range of valuations based on the Price/Earnings ratios of the following peer companies:

• CIT Group Inc. (NYSE: CIT) P/E: 14.3. $64.1 billion
• Citigroup Inc. (NYSE: C) P/E: 11. $49.3 billion
• JPMorgan Chase & Co. (NYSE: JPM) P/E: 9.7. $43.5 billion

Next: Breaking Down GE Money

Peter Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He owns General Electric shares and has no financial interest in the other securities mentioned in this post.

General Electric Co. (NYSE:GE) today reported first quarter results that matched Wall Street expectations. Investors pushed up the shares in pre-market trading.

Net income was $4.5 billion, or 44 cents per share, compared with $4.4 billion, or 42 cents, a year earlier. Revenue jumped 4 percent to $38.6 billion. Analysts expected profit of 44 cents on revenue of $39.8 billion, according to Thomson Financial.

GE's Infrastructure, Commercial Finance and Money units each posted double-digit revenue gains while GE Healthcare was little changed and NBC Universal and Industrial declined. All of the divisions showed gains in operating profit except Industrial.

Other highlights include a 32% gain in major equipment backlog, an 11% gain in services order and a 22% increase in financial services assets. Cash flow from operations rose 10 percent to $7.4 billion. The company was hurt by the meltdown in subprime mortgages at its WFC Mortgage business.

As expected, GE Infrastructure did well. Its revenue rose 18 percent to $11.9 billion, while operating jumped 28 percent to $2.2 billion. Revenue at Commercial Finance jumped 15% to $6.28 billion and 14 percent to $5.28 billion in GE Money. Commercial Finance profit rose 21 percent to $1.42 billion and GE Money profit gained 2 percent to $851 million.

Industrial revenue fell 9 percent to $7.4 billion and profit slumped 20 percent to $480 million. NBC Universal continued to lag with revenue plunging $3.48 billion as operating profit rose 6 percent to $691 million.

Investors, though, will reserve judgment on GE until this morning's earnings conference call.