Technical analysis of General Electric

Accuracy score :
97%

General Electric Co  GE

With historical ties to inventor Thomas Edison, General Electric was formed through the combination of two companies in 1892. Today, GE is known for its digital industrial offerings and massive installed base spread across a variety of products and services, including aircraft engines, gas turbines, steam turbines, wind turbines, locomotives, and LED lighting, among others. In its current form, the company focuses on aviation, healthcare, and power, but management announced corporate actions in 2018 that will make aviation, power, and renewable energy the primary areas of focus going forward.

Summary (from the latest annual and quarterly report – 2018)

  • Total equity: 31.4 billion USD
  • Market Cap is 61.7 billion USD ( the last price of the stock is 7.10 USD)
  • General Electric Co is known for its digital industrial offerings and massive installed base spread across a variety of products and services, including aircraft engines, gas turbines, steam turbines, wind turbines, locomotives, and LED lighting
  • Total equity has decreased from 75 billion USD in 2016 to 31.4 billion in 2018
  • The company has 1 billion USD in cash on account
  • Total equity – cash on account = 31.4 billion USD - 1 billion USD = 30.4 billion USD
  • In 2018 the company has 99 billion USD long-term debt, short-term debt is 15.2 billion USD
  • In 2016 the company had 105 billion USD long-term debt, short-term debt was 31 billion USD
  • Company's revenue has increased in 2017 to 120 billion USD  from 119.6 billion in 2016
  • Net loss in 2017 was 5.7 billion USD, Net income in 2016 was 8.8 billion USD
  •  In 2017 company paid 8.6 billion USD dividend to its shareholders

 

Technical analysis

GE  stock has weakened more than 60% since the beginning of the 2018 year. General Electric has been selling off a number of its subsidiaries, including the large financial division GE Capital. It is selling off these assets to scale back its business after issues with GE Capital threatened the parent company during the 2008 financial crisis. GE has sold off more than $200 billion of its assets from 2015 and on November 6, 2018, General Electric announced the latest of its subsidiary selloffs. According to the rules of technical analysis, the "bearish" trend of this stock is still very strong and for now, there is no important reason to change this negative trend.  As long the price of GE is below $12 this stock is in the "SELL" zone. On this chart (the period from June 2017), I marked resistance and support levels. Supports levels are 7 USD and 6 USD, 10 USD, 12 USD and 14 USD represent the current resistance levels. If the price jumps above 10 USD it would be a "BUY" signal and we have the open way to 12 and then to 14 USD. Rising above 15 USD supports the continuation of the bullish trend overview efficiently for the upcoming period. On the other side, 7 and 6 USD represent very strong support levels, if the price breaks 6 USD it would be a very strong "SELL" signal and we have the open way to 5 USD.

I can't recommend this stock as a buy - total debt is very big, the company is not profitable and the price of the stock is moving in strong "downtrend".

analyst 2018-12-18

Accurate report, especially the s&r levels, 6,7 allows investors to know the best areas to buy.