GE Surges on $4 Billion Plan to Speed Cut to Baker Hughes Stake
Comment of the Day

November 14 2018

Commentary by Eoin Treacy

GE Surges on $4 Billion Plan to Speed Cut to Baker Hughes Stake

This article by Brendan Case and David Wethe for Bloomberg may be of interest to subscribers. Here is a section:

“We like seeing GE’s new CEO Larry Culp hasten the pace of the company’s portfolio breakup to generate sale proceeds to de-lever the balance sheet,” Deane Dray, an analyst at RBC Capital Markets, said in a note to clients. “This is consistent with GE’s messaging that it has roughly $60 billion of potential sources of liquidity.”

Culp took over six weeks ago from John Flannery, who succeeded Immelt in August 2017.

GE was among Bridgewater’s new buys in the third quarter

GE advanced 7.8 percent to $8.61 at the close in New York, the biggest gain in more than four months. The shares had tumbled 54 percent this year through Monday, the third-biggest drop on the S&P 500 Index.

Eoin Treacy's view

General Electric has been accelerating lower and that also means that the issues assailing the company are becoming progressively better understood. The yield of the 5% junior subordinated perpetual bond have surged higher over the last week to 15%. That is a very accelerated decline so a lot of bad news has already been priced in. 

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