Finance
GE: New CEO should ‘put a floor in the stock,’ RBC says
A General Electric sign lights up at night.Wikimedia Commons
- General Electric announced Monday that CEO John Flannery would be replaced by current board member and former Danaher CEO Lawrence Culp, Jr.
- Culp is a catalyst for GE’s operational improvements and should “put a floor in the stock,” RBC says.
- Last week, RBC warned investors were skeptical of GE’s incremental bad news, such as its lagging power business.
- Watch General Electric trade in real time here.
General Electric‘s new CEO is a catalyst for operational improvements and should “put a floor in the stock,” RBC says.
The company announced Monday that CEO John Flannery would be removed from his role after 14 months on the job, and that current GE board member and former Danaher CEO Lawrence Culp, Jr., would replace him. GE shares surged more than 13% on the news, signaling market confidence in the change of leadership.
“We have known Mr. Culp for over 15 years and have deep respect for his leadership and relentless focus on operating excellence and accountability,” a team of RBC analysts led by Deane Dray said in a note sent out to clients on Tuesday.
“Investor confidence in Larry Culp’s strategic vision and operating excellence should put a floor in the stock.”
Last week, Dray warned that GE stock hadn’t bottomed yet, and that investors were skeptical of the company’s ability to hit its full-year earnings per share guidance of $1.00-1.07 as the company’s lagging power business, price-cost pressures compounded by US-China tariffs, and behind-schedule deliveries of its LEAP engine weighed.
And on Monday, GE let all the bad news out. It announced a $23 billion goodwill charge for its power business, and said free cash flow and earnings estimates for fiscal-year 2018 will likely miss their targets.
Encouraged by the reveal, Dray raised his price target to $15 from $13 and upgraded the stock to “outperform.”
“To be clear, there is still much to fix at GE, but the market can now have full confidence in the senior leader at the helm,” Dray added.
GE shares were down 30% this year through Monday.
Now read:
Get the latest General Electric stock price here.
TikTok faces a ban in the US, Tesla profits drop and healthcare data leaks
What’s on the far side of the moon? Not darkness.
How to watch ‘The Idea of You’: Release date, streaming deals
How Rubrik’s IPO paid off big for Greylock VC Asheem Chandna
Photo-sharing community EyeEm will license users’ photos to train AI if they don’t delete them
Thoma Bravo to take UK cybersecurity company Darktrace private in $5B deal
‘Challengers’ review: You’re not ready for Zendaya’s horny love-triangle drama
Summer Movie Preview: From ‘Alien’ and ‘Furiosa’ to ‘Deadpool and Wolverine’
Zomato’s quick commerce unit Blinkit eclipses core food business in value, says Goldman Sachs
Monsta X’s I.M on making music, gaming, and being called ‘zaddy’
API startup Noname Security nears $500M deal to sell itself to Akamai
NASA discovered bacteria that wouldn’t die. Now it’s boosting sunscreen.
US think tank Heritage Foundation hit by cyberattack
How to watch ‘Argylle’: When and where is it streaming?
Tesla drops prices, Meta confirms Llama 3 release, and Apple allows emulators in the App Store
Tesla layoffs hit high performers, some departments slashed, sources say
TechCrunch Mobility: Cruise robotaxis return and Ford’s BlueCruise comes under scrutiny
Meta to close Threads in Turkey to comply with injunction prohibiting data-sharing with Instagram
Former top SpaceX exec Tom Ochinero sets up new VC firm, filings reveal
Consumer Financial Protection Bureau fines BloomTech for false claims
TikTok faces a ban in the US, Tesla profits drop and healthcare data leaks
What’s on the far side of the moon? Not darkness.
How to watch ‘The Idea of You’: Release date, streaming deals
How Rubrik’s IPO paid off big for Greylock VC Asheem Chandna
Photo-sharing community EyeEm will license users’ photos to train AI if they don’t delete them
Thoma Bravo to take UK cybersecurity company Darktrace private in $5B deal
‘Challengers’ review: You’re not ready for Zendaya’s horny love-triangle drama
Summer Movie Preview: From ‘Alien’ and ‘Furiosa’ to ‘Deadpool and Wolverine’
Zomato’s quick commerce unit Blinkit eclipses core food business in value, says Goldman Sachs
Monsta X’s I.M on making music, gaming, and being called ‘zaddy’
-
Business7 days agoTikTok Shop expands its secondhand luxury fashion offering to the UK
-
Business6 days agoUnitedHealth says Change hackers stole health data on ‘substantial proportion of people in America’
-
Business6 days agoMood.camera is an iOS app that feels like using a retro analog camera
-
Business4 days agoTesla’s new growth plan is centered around mysterious cheaper models
-
Business3 days agoXaira, an AI drug discovery startup, launches with a massive $1B, says it’s ‘ready’ to start developing drugs
-
Business4 days agoUK probes Amazon and Microsoft over AI partnerships with Mistral, Anthropic, and Inflection
-
Entertainment6 days agoFurious Watcher fans are blasting it as ‘greedy’ over paid subscription service
-
Business5 days agoTwo widow founders launch DayNew, a social platform for people dealing with grief and trauma
