Shareholders of General Electric (GE) are the main beneficiary of stock markets stabilizing in April and up in the last month. Markets become more forgiving and less risk adverse, paving the way for GE stock to climb steadily and away from the single-digit dollar value. Core businesses are stabilizing and opportunities are emerging that suggest the stock is finally range-bound in the worst-case scenario.
“All those waiting for single digits - Forget it!”
– SA User AlieGee
Analysts continue to view GE as a sum-of-the-parts value play, citing a value of at least $20 a share if the company were to break itself up. That speculation often signals the markets believe the company has far more value than the current share price. Unlocking that value is the missing ingredient needed to realize any upside as a shareholder. Management is unlikely to aggressively break up the company into smaller parts just to please short-term shareholders. In its current size, GE may continue to realize operational efficiencies by sharing costs among the units.
