Perhaps the most surprising thing about General Electric Co.’s latest earnings report was that there weren’t really any surprises.
The power unit continues to struggle. The aviation division is soaring. The company stuck with its 2018 profit forecast while reiterating that earnings would probably come in at the low end of the expected range.
“There were no big snafus,” Nicholas Heymann, an analyst with William Blair & Co., said about GE’s second-quarter results. “This is really, in a turbulent market, a story about whether they can execute. Can they pay down their debt? Can they improve their financial flexibility? Can they begin to execute to unlock value?”
The plain-vanilla earnings report stands out after one of the biggest slumps in GE’s 126-year history, in which the company suffered weak cash flow, drew scrutiny from securities regulators and was kicked out of the Dow Jones Industrial Average. GE could use some stability amid a slide that has wiped out $160 billion in investor wealth over the past year and a half.
After unveiling a long-awaited turnaround plan last month, Chief Executive Officer John Flannery is now aiming to put that program in motion and restore confidence in what stands to be a smaller and more-focused manufacturer. The goal now is on “unrelenting execution,” he said in a statement Friday.
GE was little changed at $13.72 ahead of regular trading in New York. While the shares fell 21 percent this year through Thursday, they managed to climb slightly from April to June, marking the first quarterly gain since late 2016.
“No bad news is good news,” said Karen Ubelhart, an analyst with Bloomberg Intelligence.
Continue Reading at Bloomberg.com