General Electric Co. (NYSE: GE) today gave a bullish outlook for 2007 helped by growth in energy, healthcare and infrastructure.

Revenue will be $175 billion this year, with a profit of $23 billion, according to a Dow Jones report. That's better than the $171.6 billion average consensus estimate expected by analysts surveyed by Thomson Financial. Chief Executive Jeffrey Immelt crowed on his company's CNBC network that "global growth is really substantial now." Like other CEOs, Immelt sees the housing market as "tough," which may hurt some GE businesses such as appliances.

Immelt dismissed talk on Wall Street calling for the conglomerate to dump its NBC Universal media and entertainment business, pointing to its improving performance. "I am all about running NBC Universal for the long-term," he said.

NBC Universal Chief Executive Jeff Zucker made it clear at a conference yesterday that GE (NYSE: GE) had no interest in selling the media business. Referring to GE CEO Jeff Immelt, Zucker said, "He has said numerous times that NBCU is not for sale. It is not for sale after the Olympics." Some press reports have indicated that GE would take the big money from the sports event and then dump the business on some sucker.

It is odd that the head of a GE division should have to make this kind of comment at all. The head of the locomotive division probably wouldn't make comments about the future of his business. Meanwhile, NBC Universal can go on operating as usual whether Wall Street thinks it is for sale or not.

The argument for selling NBC is that the unit does not fit with the conglomerate's industrial and financial operations. That is true, but owning a network does mean tickets to the Super Bowl and the Oscars.

NBC is a $15 billion business with operating income running about $2.5 billion, making it a modest part of GE's overall earnings. Still, the business is about the size of CBS (NYSE: CBS), which has a market cap of $21 billion and debt of $7 billion.

For the $28 billion enterprise value of CBS, GE would sell NBC tomorrow.

Douglas A. McIntyre is an editor of 247wallst.com.

The plan makes sense, at least on paper. GE (NYSE: GE) believes that it can offset any slowdown in its US business by the acceleration of revenue in China and India. It is, perhaps, one of the benefits of being a multinational.

The FT writes that, "GE's chairman and chief executive (Jeffrey Immelt) said the company's sales in emerging markets such as China and India were expanding at 20 percent a year, and there were few signs of this growth slowing."

But, GE's view is based on two assumptions that may not be true. The first is that a slowdown in the US will not spread to Asia and the Indian subcontinent. Much of the export income from China and India depends on demand in the US and Europe. if that demand slackens, there is no guarantee that their own economies will be able to continue growing rapidly.

GE is also assuming that growth in these countries, particularly China, will not come without a cost. Trade tensions between the US and the world's most populous country still exist. The China toy debacle demonstrates that. It would not take so terribly much for China to shut its markets to certain US goods and services, if it feels that it has been provoked.

GE's plan to keep growing outside the US looks good, for now.

Douglas A. McIntyre is an editor at 247wall st.com.

General Electric Company's (NYSE: GE) Industrial segment is worth between $20.2 billion and $21.7 billion, according to my estimates.

GE Industrial, which constituted 20.5%, 22.1% and 22.9% of GE's revenues in 2006, 2005 and 2004, respectively produces and sells products including consumer appliances, industrial equipment and plastics, and related services. It also provides asset management services for the transportation industry.

GE Industrial strikes me as a hodgepodge of businesses that should either be fixed or sold. In the second quarter, this segment's revenues declined while its profits increased slightly. I was intrigued that Keith Sherin said that its appliances unit generated a return on total capital of 70%. On the other hand I wonder about how many of the other units within this segment earn such high returns.

Assuming that GE Industrial generates net income of $1.3 billion in 2007, here are the range of valuations based on the Price/Earnings ratios of the following peer companies:

• Whirlpool Corp. (NYSE: WHR) P/E: 15.2. $20.2 billion
• Electrolux AB (ADR) (OTC: ELUXY) P/E: 16.3. $21.7 billion

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.

After my meeting with General Electric Co. (NYSE: GE) CFO Keith Sherin last week, I tried to figure out how much GE's NBC Universal might be worth in the open market. Such analysis is relevant now for two reasons:

• GE's stock price has fallen 2% under its current CEO. When Jeff Immelt took over as CEO on September 7, 2001, GE was trading, 2%, or 87 cents, above today's $38.79. During that same period, the S&P 500 rose 40%. In predecessor Jack Welch's first 5.9 years as CEO, GE's stock rose 221% from a split-adjusted $1.40 in April 1981 to $4.50 in March 1987.
• A respected analyst recently advocated a breakup to get GE stock moving. The New York Times [registration required] recently reported that Citigroup Inc.'s (NYSE: C) John Sprague issued a report titled "Partial Break-Up Could Break Deadlock on the Stock."

Is GE worth more broken up in pieces and sold or kept intact? To answer this, let me explain how a conglomerate like GE can raise its stock price. My theory is that GE management has two levers: the P/Es of the industries in which GE competes and the earnings growth rates of its businesses in those industries. To increase GE's market value, its management should prune GE's portfolio of businesses with the lowest P/Es and slow earnings growth -- replacing them with high P/E, fast earnings growth businesses which it can run successfully (if that can be done without overpaying). Nevertheless, as noted here, I am not sure whether a conglomerate is a good corporate strategy for GE because it may be leading the stock market to discount its earnings by 4%.

I address whether breaking up GE will increase its stock price in Breaking Down GE, a seven-post series.

For years, General Electric (NYSE: GE) has suffered from perceptions of mediocrity, and its stock price has stayed relatively flat. But its revenues and margins have been growing steadily, and its second-quarter results showed revenues up 12% over the second quarter of 2006, 8% of which came organically, and investors are paying attention again. The stock is now trading at a long-time high of $40, and a Goldman Sachs analyst report this week predicted the stock would reach as high as $45.

GE's success has resulted in large part from a continuing boom in global infrastructure needs, and all its divisions have been doing well of late except NBC and its health-care sector. The company has benefited from global trends, but CEO Jeffrey Immelt continues to make improvements, from investing in a major buyback program of $14 billion to getting out of the plastics business to, most recently, announcing GE would exit the subprime mortgage industry. GE's subprime division, WMC Mortgage, was a tiny part of the company, but Immelt was smart to avoid losing any more money, and to avoid the kind of negative publicity that has hit firms, like Bear Stearns, that are deeply involved in that failing industry.

Next Tuesday I am scheduled to meet with General Electric Co. (NYSE: GE) Chief Financial Officer Keith Sherin to discuss GE's performance and prospects. This meeting came at the company's initiation.

As a GE shareholder I have not been thrilled with the performance of the stock. Since September 7, 2001 when current CEO Jeff Immelt took over, the stock has risen 3% from $39.60, compared to a 40% increase in the S&P 500. Moreover, on the basis of its Price/Earnings to Growth (PEG) ratio of 1.5 -- based on a P/E of 19.5 and earnings forecast to grow 13% to $2.50 in 2008 -- GE looks somewhat overvalued to me.

So here are some questions I plan to ask:

• Since the current GE CEO took over, GE stock is up 3%, compared to a 40% increase in the S&P 500. Why has GE stock underperformed this average?
• GE stock has risen 23% in the last year, however, it trades at a PEG of 1.5 which makes it a bit expensive. Why should investors buy GE stock now?
• Since the Healthcare, Industrial and NBC Universal segments all saw revenues fall in the first half with relatively weak profit performance, why doesn't GE sell these businesses and invest the proceeds to increase its market share in the more financially successful Infrastructure and Commercial Finance units?
• If GE chooses to stay in Healthcare how will it offset the negative impact of the federal government's decision to cut reimbursements to nonhospital imaging centers?
• Under Jack Welch, GE's philosophy was to only be in businesses in which it could be #1 or #2. Recently NBC was ranked the 4th most watched network. Will GE sell NBC? If not, why is GE keeping NBC? How does NBC's coordination with other GE divisions increase GE's overall revenues or lower its costs?
• How vulnerable is the GE Money unit to an increase in consumer loan defaults? Is GE Money likely to experience accelerated revenue and profit growth in 2008 or slower growth? Why?
• What impact would a 10% decline in the dollar have on GE's Earnings Per Share (EPS)?
• What other external factors -- such as an increase in interest rates or a rise in energy prices -- represent the biggest risks to GE's EPS? How do you quantify those risks?

Please let me know which ones you'd like to add to the list.

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 stock.

General Electric (NYSE: GE) has big plans in India. Speaking in New Delhi, GE CEO Jeffrey Immelt announced that the company plans to invest heavily in India, particularly in infrastructure. According to The New York Times, Immelt declared that "this is the era of the developing world and of emerging markets," and that GE can achieve higher growth by focusing on India and other high-growth economies.

Immelt was quoted, "If we can grow at the same pace as the Indian economy, we can be a great company." India's economy grew at a rate of 9.4% in the year ending March 2007, and is expected to grow at roughly the same rate this year. Given that the U.S. economy is barely growing at all right now, this strategy certainly makes sense.

Global demand for new infrastructure is staggering. Immelt claimed that over the next eight years, the global economy will require some $4 trillion in investment. GE plans to make India a central part of its global infrastructure strategy. In 2007, GE expects to generate $3 billion in revenue from India (out of $175 billion overall); by 2010, it expects $8 billion in revenue, based on $8 billion in Indian assets. Major projects include nuclear and conventional power plants, jet engines for Air India, health care facilities and real estate.

An article in Sunday's Times suggests that GE is a good international markets play. According to Michael Metz, the chief investment strategist of Oppenheimer & Company, "If you buy General Electric . . . you almost don't need a foreign stock fund." And if you are looking for a way to invest in the rapidly growing Indian economy, GE stock may be a good move.

General Electric Co. (NYSE: GE) Chief Executive Jeff Immelt's has given Jeff Zucker plenty of chances to improve NBC Universal. Now, it's time for someone else to run the media conglomerate.

Though NBC's performance is showing signs of improvement, it continues to be one of the laggards in the GE portfolio. Investors are clamoring for the Fairfield, Conn.-based company to spin-off or sell the media conglomerate. NBC prime time ratings are stagnant and still overly dependent on the "Law and Order" franchise. While I am a huge fan of "Scrubs" and "My Name is Earl," I realize that the quirky humor of those sitcoms may not appeal to everyone.

Yesterday, Zucker reshuffled the top management at NBC, ousting programming head Kevin Reilly and replacing him with with Ben Silverman and Mark Graboff. Maybe Zucker thought Reilly, whose contract was recently extended, was working too hard. I'm surprised that Zucker didn't escape the axe himself.

Indeed, anytime a company fills a job that one person did with two or more people, that's a bad sign. It's a recipe for instability and will guarantee turf battles between high-powered executives. However, this does allow Zucker the chance to spread blame around to more people when things go wrong or don't go right fast enough.

I'll first state that I don't really like the idea of General Electric Co. (NYSE: GE) selling its plastics division. I haven't liked it since I first saw it mentioned. I see too much potential there for GE to take advantage. In my mind, GE Plastics can provide significant cross benefits to its other divisions with the development of new materials. I've always viewed GE Plastics as it's defacto R&D department. Developing new materials figures into the forward progress of almost everything.

Be that as it may, it would seem that the plastics division shall be sold and there is solid interest in the acquisition from abroad. Last month, a firm in Saudi Arabia was reported to be considering a $12 billion offer for GE Plastics. $12 billion is about 20% more than what analysts are saying would be a good purchase price. That's not just sliced pickles buddy.

The question I'm addressing though, is would GE Plastics be a good acquisition for Warren Buffett? I haven't talked to the man so I don't have a solid picture of his criteria. I do know that at $12 billion, the purchase would fit comfortably within his stated budget, and again I say that I see tremendous potential within the division. I recently posted about the interesting developments taking place between GE Plastics and Hyundai (OTC: HYMLF) in regard to automobile manufacturing. There has also been some buzz about GE Plastics involvement with General Motors Corp.'s (NYSE: GM) new Chevrolet Volt . Perhaps GM should purchase the division? At the very least, GE plastics is an active entity and we haven't heard the last of it by far.

Perhaps Jeffrey Immelt and Warren Buffett should have lunch and discuss the possibilities. I'll see if I can arrange that... in my dreams!

When General Electric Co. (NYSE:GE) reports fourth-quarter results next week, the main thing that will be on investors' minds will be mergers and acquisitions.

GE is reportedly seeking $10 billion for its plastics business. Merrill Lynch's John Inch thinks the conglomerate may be "gearing up" for a multi-billion dollar deal, according to Bloomberg News.

There are plenty of tempting targets for the Fairfield, Connecticut-based company, including ABB Ltd., the Swiss industrial firm that would fit nicely with GE's power-generation business, Bloomberg says, adding that CEO Jeff Immelt has said he's interested in deals in health care information technology, oil and gas, security and sensing, water treatment, and Hispanic media.

GE continues to deliver profit growth across its business lines, with the exception of NBC Universal. The parent of the NBC television network and Universal film studios was the only unit to show a decline in operating profit in the third quarter. GE is cracking the whip at NBC Universal. It announced plans in October to cut 700 jobs and to slash operating costs by $750 million. Though it's flashy and glamorous, NBC Universal is the smallest by revenue among GE's businesses.

Wall Street is expecting General Electric to post earnings of 64 cents on revenue of $44.18 billion, according to Thomson Financial. Last month, the company affirmed its guidance of 62 cents and 64 cents for the quarter, and $1.97 to $1.99 for 2006. Earnings are set to be released on January 19.

Also check out some other earnings reports that we're following, and let us know your thoughts on earnings expectations.

I'll make this short and sweet. As they used to say on Dragnet: "Just the facts ma'am."

General Electric (NYSE:GE) has reaffirmed double digit EPS growth for 2006, claiming a 15% to 16% increase for the year 2006. GE chairman and CEO Jeff Immelt has made it clear that GE is positioned for a similar increase in the coming year and that value growth is a large part of the company's drive and focus. GE raised its quarterly per share dividend 12% on December 12, 2006 to a record $1.12. By executing stock buy-back initiatives and dividend increases, GE has provided investor compensation in excess of $18 billion this year alone. This mirrors over 30 years of continued share value increases by General Electric.

GE's growth plan includes environmental sustaining and protecting initiatives, the development of products which reduce energy consumption, global economic sustainability and increasingly powerful alliances with governments and businesses world wide. In my opinion, I've never seen a company I would be happier to associate myself with.

If you want the whole picture, please use this link and feel free to have a look around on the GE website. I think you'll be glad you did!

Wal-Mart Stores, Inc. (NYSE:WMT) has joined forces with General Electric Company (NYSE:GE) to offer a branded credit card to Chinese consumers. Wal-Mart is heading fast and strong into capturing more and more of the Chinese consumer's shopping dollar, and GE's finance arm, already a global powerhouse in consumer credit lending, will be providing the strategic logistics to make the new credit card venture work.

The new Wal-Mart credit card -- which will be part of the Visa network -- will be officially launched this Friday and will have the capability to be used for purchases in China and other parts of the world as well, according to Jonathan Dong, a spokesman for Wal-Mart China. In addition to General Electric, Wal-Mart has partnered with China's Shenzhen Development Bank Ltd. to underwrite the cards.

Since this is the second credit facility Wal-Mart China has launched in China in as many months, it's indicative of the global retailer's strategy to try and conquer the Chinese market early and swiftly. With China's economy growing at a fast and ardent rate these days, and with Wal-Mart's international strategy and success a little spotty, this seems like a perfect match. I'm willing to bet Chinese consumers will agree.

Jeffrey Immelt has been the CEO of GE for 5 years, living in the very large shadow cast by former CEO Jack Welch. Senior Writer Diana Brady of Business Week recently interviewed Immelt about his tenure at GE. A portion on the interview is in the September 11, 2006 issue of Business Week. Additional portions of the interview are available through www.businessweek.com/extras. Not only did Immelt have to follow a larger than life character in the slot as CEO, but he took over shortly before the terrorist attacks on September 11, 2001. Also included in Immelt's rookie year were the Enron scandal and a general enconomic recession. General Electric stock is still worth less than when Immelt took over, despite his efforts at instilling a culture of innovation.

The interview is short on financial specifics, but Immelt does offer some revealing pesonal comments on himself and his job. Despite the disruptions caused by Immelt trying to foster his own sense of corporate culture throughout the GE behemoth, Immelt still feels he should have moved faster to instill the need for positive response to change. The CEO is the chief advocate of change, no matter whether he or she is the only one in favor of it. Like other CEOs Immelt feels that the regulatory pendulum has swung too far towards the punitive watchdog side of the arc, and needs to return to a more middle course.

Immelt considers the primary focus of his job to be to figure out how to grow GE with an acceptable degree of risk. Immelt is proud that under his watch, GE has grown 65% bigger, and earnings have doubled. Growth posibilities include GE operations in China, currently $6 billion annually, as well as in areas of energy efficiency and environmental sustainability.

GE stock closed on 5 September 2006 at $33.97, down .17 for the day in lighter than average trading.