# General Electric (GE)



## SkyFall (Jun 19, 2012)

I did a quick research didn't find a thread about this company, which surprised me.

So GE is at $25.07, a $3 drop from 52 weeks high of $28 and is under 200 day average.... I think imma buy some right here!


----------



## MrMatt (Dec 21, 2011)

SkyFall said:


> I did a quick research didn't find a thread about this company, which surprised me.
> 
> So GE is at $25.07, a $3 drop from 52 weeks high of $28 and is under 200 day average.... I think imma buy some right here!


Hasn't moved much lately, and I'm thinking of picking up some in the next few days, any thoughts?


----------



## SkyFall (Jun 19, 2012)

still below its 52 high, and good dividends... GE is one of my VERY longterm stock.... my thoughts, buy it and enjoy dividends


----------



## fatcat (Nov 11, 2009)

they've been going sideways for a long time but eventually are going to take off I think


----------



## My Own Advisor (Sep 24, 2012)

Long-term hold for me, almost like a bond.


----------



## praire_guy (Sep 8, 2011)

The current CEO is a liar and cannot be trusted. 
He said outright that the dividend would NOT be cut in the 2008 crises. He didn't dance around the topic or talk like a politician. 
We were told the,dividend was safe. 
As long as he is around I will not invest as this violates buffets rule of honest competent management ( wonder why wb is,still invested in ge? )


----------



## MrMatt (Dec 21, 2011)

praire_guy said:


> The current CEO is a liar and cannot be trusted.
> He said outright that the dividend would NOT be cut in the 2008 crises. He didn't dance around the topic or talk like a politician.
> We were told the,dividend was safe.
> As long as he is around I will not invest as this violates buffets rule of honest competent management ( wonder why wb is,still invested in ge? )


What was the time lapse from the promise, to the break of that promise?


----------



## Nemo2 (Mar 1, 2012)

Bought some GE July '09 @ $11.75US......currently up ~ 129% ..... suits us.


----------



## My Own Advisor (Sep 24, 2012)

Nemo2 said:


> Bought some GE July '09 @ $11.75US......currently up ~ 129% ..... suits us.


Nice....for sure!


----------



## fatcat (Nov 11, 2009)

praire_guy said:


> The current CEO is a liar and cannot be trusted.
> He said outright that the dividend would NOT be cut in the 2008 crises. He didn't dance around the topic or talk like a politician.
> We were told the,dividend was safe.
> As long as he is around I will not invest as this violates buffets rule of honest competent management ( wonder why wb is,still invested in ge? )


a ceo that lies ? ... i'm gonna report him to the ceo guild for an ethics violation ... they will make his life a living hell i assure you


----------



## praire_guy (Sep 8, 2011)

MrMatt said:


> What was the time lapse from the promise, to the break of that promise?


I can't recall,exactly, but it was very close. It wasn't like he said no dividend cut and then 10 years later it was cut. 
He was asked during the crises, and it was cut during the crises.


----------



## pastorash (Feb 3, 2014)

Down quite a bit year to date, anyone considering picking up some?


----------



## jargey3000 (Jan 25, 2011)

....I do like their runway...going forward......


----------



## pastorash (Feb 3, 2014)

I'm down 26% on this and kinda wish I had some capital to deploy here. Still consider it a good long term hold, though with obvious short term headwinds.


----------



## fatcat (Nov 11, 2009)

sold mine a few months ago, tired of sitting on the runway waiting to take off ...


----------



## My Own Advisor (Sep 24, 2012)

Same fatcat. I thought I would own this for decades, but nope.


----------



## nobleea (Oct 11, 2013)

Still going down. Down something like 10% in the last 3 days.


----------



## james4beach (Nov 15, 2012)

GE has cut its dividend, only the 3rd time the dividend has been cut in 118 years. A good reminder that stocks are not bonds, and don't guarantee return of capital or steady dividend cashflow.
https://www.cnbc.com/2017/11/13/gen...o-12-cents-a-share-from-24-cents-a-share.html

15 year GE return including dividends = 1.86% per year
15 year IEF (treasury bond index) return = 4.51% per year

It goes to show you that a "blue chip" industrial name with a solid dividend track record does not necessarily perform better than bonds, even in the middle of a stellar stock bull market!


----------



## doctrine (Sep 30, 2011)

This isn't an example of how a blue chip dividend paying company can be a bad investment. It is an example that if you own a blue chip dividend paying company that makes dumb decisions year after year, you should probably sell, and you'll probably have years to get out.

GE has never really recovered in the last decade. Management have shown they consistently make bad decisions. They loaded up on financials before the financial crash, and then unwinded them again at the worst possible time. 

The death blow for me would have been in 2015 when they unwound all their financial assets and then spent all of the proceeds and more on share buybacks - something like $40 billion or more. I bet they wish they had $40B to reinvest in the business now. And for what? Fortunately, everyone had years to get out, and even now the 5 year return isn't that bad.


----------



## yyz (Aug 11, 2013)

Don't forget the genius move with Baker Hughes which they apparently after 4 months are looking at getting out.


----------



## james4beach (Nov 15, 2012)

doctrine said:


> The death blow for me would have been in 2015 when they unwound all their financial assets and then spent all of the proceeds and more on share buybacks - something like $40 billion or more.


If it makes you feel better, many big companies in the S&P 500 are spending record amounts on share buy backs (or have just eased off record levels). Some analysts have argued that these massive share buybacks are a key contributor to this crazy bull market in stocks.


----------



## hboy54 (Sep 16, 2016)

james4beach said:


> GE has cut its dividend, only the 3rd time the dividend has been cut in 118 years. A good reminder that stocks are not bonds, and don't guarantee return of capital or steady dividend cashflow.
> https://www.cnbc.com/2017/11/13/gen...o-12-cents-a-share-from-24-cents-a-share.html
> 
> 15 year GE return including dividends = 1.86% per year
> ...


Again, I have to make a point that I regularly make that never seems to sink in: nobody invests on one day in one thing and then comes back in 15 years and declares what is their return.

In that 15 year period, an investor with a bit of moxy might have purchased a bunch of GE in 2009 at $12 or $8, and done very well in the name. Plus they might have seen 3 or 4 bags and sold some around $30 in the last couple of years.

The 15 year return quote is probably accurate, but it certainly is of zero utility to me in terms of informing me about the investing process in general, and how to invest in GE in particular.

Hboy54


----------



## pastorash (Feb 3, 2014)

While my loss is currently around 40% here I am at least more confident in the company heading forward, as long as they use the dividend money saved to directly invest in the business for better returns. We shall see. No point selling now, don't see much more downside in the short term. (He says with knowing foretelling.)


----------



## james4beach (Nov 15, 2012)

GE has given a zero total return, including dividends, over 19 years.

So much for "buy and hold a high quality blue chip stock". Is this just a matter of diversification? GE didn't deliver, but other large caps did just fine. It would be interesting to get a list of all the 'blue chip' stocks back in 1990 or 1980 and see their performance to date. Does anyone know of any studies like this?


----------



## fatcat (Nov 11, 2009)

james4beach said:


> GE has given a zero total return, including dividends, over 19 years.
> 
> So much for "buy and hold a high quality blue chip stock". Is this just a matter of diversification? GE didn't deliver, but other large caps did just fine. It would be interesting to get a list of all the 'blue chip' stocks back in 1990 or 1980 and see their performance to date. Does anyone know of any studies like this?


what you are after is the return of bonds vs stocks james and stocks do better though in any given 10 year period bonds may outperform ... 

you have a tendency to try and validate the case for bonds but both are fine if you choose wisely, right ?

http://money.cnn.com/retirement/guide/investing_bonds.moneymag/index3.htm



> Over the long term, stocksdo better. Since 1926, large stocks have returned an average of 10 % per year; long-term government bonds have returned between 5% and 6%, according to investment researcher Morningstar.


this below is the mother lode of numbers from nyu ... a veritable feast for a guy like you james 

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html

as you see stocks beat treasury bonds in every time period


Arithmetic Averagestockst-billst-bondsStocks - T.BillsStocks - T.BondsStocks - T.BillsStocks - T.Bonds1928-2016*11.42%*3.46%*5.18%*7.96%6.24%2.13%2.28%1967-2016*11.45%*4.88%*7.08%*6.57%4.37%2.42%2.74%2007-2016*8.65%*0.74%*5.03%*7.91%3.62%6.06%8.66%Risk PremiumGeometric AverageStocks - T.BillsStocks - T.Bonds1928-2016*9.53%*3.42%*4.91%*6.11%4.62%1967-2016*10.09%*4.83%*6.66%*5.26%3.42%2007-2016*6.88%*0.73%*4.58%*6.15%2.30%


----------



## james4beach (Nov 15, 2012)

fatcat, what I'm getting at is, what about for people who just bought a handful of "high quality" stocks and sat on them? Nobody bought a market index in 1926. Heck, nobody even bought a market index in 1970.

What if one just buys great blue chip stocks and holds them? To try this, I pulled up the oldest financial filing I could find for the Vanguard 500 fund, dated 2003 (I'd love to look further back if I could find the data).

This will tell us what the largest cap blue chip portfolio would have been in 2003. The top 10 holdings were: GE, MSFT, PFE, XOM, WMT, C, JNJ, AIG, IBM, INTC. How did these 10 stocks do? These were the great blue chips in 2003, so you can presumably buy and hold them forever. Let's see what happens when you do.

GE: total cumulative return is +23% including dividends
MSFT: awesome return here, +379% total
PFE: +97%
XOM: +243% better than I expected
WMT: +154%
C: d'oh -73% but hey at least it still exists
JNJ: +287% another win
AIG: -93% well that sucks
IBM: +159%
INTC: +322%

For buying & holding America's best blue chip stocks, you got an average total return of +150% which works out to *+6.4% annual return*

OK that's not bad, though it's lower than both the S&P 500 index and even TSX index returns.

Nothing groundbreaking here, but I think it's nice to remember that even the "best stocks in the world" don't necessarily turn out to be winners, so one has to diversify. Of the 10 most popular / blue chips in 2003, three of them (GE, C, AIG) turned out to be absolute disasters!


----------



## fatcat (Nov 11, 2009)

james4beach said:


> fatcat, what I'm getting at is, what about for people who just bought a handful of "high quality" stocks and sat on them? Nobody bought a market index in 1926. Heck, nobody even bought a market index in 1970.
> 
> What if one just buys great blue chip stocks and holds them? To try this, I pulled up the oldest financial filing I could find for the Vanguard 500 fund, dated 2003 (I'd love to look further back if I could find the data).
> 
> ...


james, you are cherry picking

check the link at the top of his chart, he in fact used the s&p500 index

the s&p500 beats bonds in every single time period

you just buy SPY or IVV and walk away from them exactly as buffet has told his executors to do for his wife

the whole point is not to buy blue chips but to buy all the blue chips


----------



## KaeJS (Sep 28, 2010)

James,

Your points are not valid.

What if you had bought C in 2011?

I remember trading it at $40. Now it is $70+. Just because they were -73% over the timeframe you gave does not mean they are or were a bad investment.

You do realize that over your time period we (arguably) had the worst modern recession of all time... Especially one that is devastating for financials. So, the fact that C and AIG posted losses for that period is about as surprising as the sun coming up in the morning...


----------



## james4beach (Nov 15, 2012)

KaeJS said:


> What if you had bought C in 2011?


It still did quite a bit worse than the S&P 500 

But yes, horrible recession and all that. I wonder how often these will happen. 2001-2003 wiped out a lot of big stocks, and then again in 2007-2009. Maybe now it's clear sailing for the next 20 years?


----------



## hboy54 (Sep 16, 2016)

james4beach said:


> Maybe now it's clear sailing for the next 20 years?


Oh Gawd I hope not. Your nirvana is my lost opportunity.

Hboy54


----------



## doctrine (Sep 30, 2011)

I'll just point out there that, with GE sitting here at $18, we sometimes forget that while past outperformance doesn't guarantee success, past underperformance doesn't guarantee failure. Somewhere under GE is a fantastic business and brand and they have a new CEO. He's doing some smart things such as throwing out all of the junk and garbage now. It's a strategy used by good CEOs to rebaseline everything and clean the slate so they can be rewarded for success. Anyway, just a thought, I'm not in the stock other than through the S&P500 which continues to hit all time highs in both Cdn and USD.


----------



## nobleea (Oct 11, 2013)

Seems to have found a bit of a base at $18. The P/E is below the S&P500 average.


----------



## KaeJS (Sep 28, 2010)

Even if you bought at this price and it ended up going lower... You really can't blame yourself or anyone else.

It's a pretty damn good deal at $18 regardless of the "issues".

As far as I see it, the issues are all out of the bag and the stock has fallen through the floor. I'd say at this point, it's more foolish to not buy than it would be to buy.

Disclosure: I don't have a position. But have been thinking about selling some $18 puts on this baby.


----------



## pastorash (Feb 3, 2014)

I find it bizarre that at a 25% loss on this stock I was contemplating selling it but now that I'm down 42% I'm considering buying. What an emotional game this business of picking stocks is.


----------



## james4beach (Nov 15, 2012)

GE continuing to get destroyed. The volume pattern also shows institutional dumping, large amounts being sold over the months.

According to Morningstar, GE's *15 year performance is 1.26% per year*. It's been a much worse investment than cash.

Here's a graph of GE (green) vs the S&P 500 index (black) since 2003. Both graphs include dividends.
http://stockcharts.com/h-sc/ui?s=GE&p=D&st=2003-01-01&id=p56612017223

This is very bearish for GE, in my opinion. GE started underperforming after it almost collapsed during the financial crisis and got Berkshire's bailout. In the following bull phase, it underperformed. Now there's a very sharp divergence happening from the S&P 500 which shows that money managers are very deliberately unloading GE to under-weight it.


----------



## doctrine (Sep 30, 2011)

The TA is bad, but makes decisions pretty easy. Just don't buy. It's under every single one of its moving averages and at a new 52 week low.


----------



## TomB19 (Sep 24, 2015)

GE is now at 14 bucks and losing $0.72 per share.

I'm bumping this thread because I'm intrigued by ge's new 12MW wind turbine. That's a lot of power from a single source. An offshore farm of 100 turbines will produce 1.2GW. That's enough power for time travel.

It's starting to become interesting.


----------



## gardner (Feb 13, 2014)

GE is an absolute behemoth. The wind turbine business is noise -- it is not going to turn them around on its own.



TomB19 said:


> That's enough power for time travel.


You'd need 101 for the requisite 1.21GW.


----------



## james4beach (Nov 15, 2012)

GE's 15 year annualized return (including dividends) is now -1.22%. And this is not cherry-picking: 15 years ago was 2003, which was the start of a powerful bull market in stocks.

That's the biggest and most popular stock in America returning negative 1% per year, through _two_ powerful bull markets. Talk about a disappointment!

But good news, the new CEO will be paid extremely generously:
https://www.bloomberg.com/view/arti...s-payday-sends-the-wrong-message?srnd=premium


----------



## SixesAndSevens (Dec 4, 2009)

james4beach said:


> That's the biggest and most popular stock in America returning negative 1% per year, through _two_ powerful bull markets. Talk about a disappointment!


so what? you could have bought Google in 2003...calculate the annualized return on *that*...cherry picking examples works both ways each:


----------



## james4beach (Nov 15, 2012)

Fraud concerns, GE crashing now. The concerns raised are about accounting in their financial division
https://www.bloomberg.com/news/arti...ls-accounting-accusations?srnd=premium-canada

This is the worst Dividend Aristocrat stock I've ever seen.


----------



## doctrine (Sep 30, 2011)

GE ceased to be a dividend aristocrat in December 2017. If you got out when they hacked their dividend by 50%, you could have easily sold at $17.50-18.50 USD. When a company cuts its dividend, it is typically a good time to sell even if you still want to own the shares. Because turnarounds take time and there will be plenty of time to buy back.


----------



## james4beach (Nov 15, 2012)

Here's an update on this former Dividend Aristocrat, and the most popular (and most widely held) stock in the world. It hasn't rallied at all with the stock market rebound this year.

I wonder which of today's popular stocks will look like this in another 10-15 years. You should never 'buy and hold' a stock forever.

GE is in red, S&P 500 in black:


----------



## 307169 (May 24, 2015)

End of an era, GE is turning into 3 separate companies.


----------



## nobleea (Oct 11, 2013)

There is a GE Fair Fund to compensate investors who bought between Oct 16 2015 and Jan 16 2018. (I bought 100 shares during that time period. Seems like a simple-ish application.






GE Fair Fund | Administered by RCB Fund Services







gefairfund.com





Has to be submitted by Oct 19, so a tighter timeline.

I received notice by mail.


----------



## m3s (Apr 3, 2010)

nobleea said:


> There is a GE Fair Fund to compensate investors who bought between Oct 16 2015 and Jan 16 2018. (I bought 100 shares during that time period. Seems like a simple-ish application.
> 
> 
> 
> ...


Thanks. It says US exchange though? Wonder if Canada will get its act together

"If you purchased GE common stock on a *U.S. exchange* during the period from October 16, 2015 through the close of the market on January 16, 2018, you may be eligible for compensation from the GE Fair Fund."


----------



## nobleea (Oct 11, 2013)

I don't think GE was listed in Canada, so any purchases would be valid. The forms certainly have the fields for it.

It would be nice if Canada had a similar law requiring these funds. These are determined by the SEC I think, not some class action lawsuit law firm.


----------



## m3s (Apr 3, 2010)

nobleea said:


> I don't think GE was listed in Canada, so any purchases would be valid. The forms certainly have the fields for it.
> 
> It would be nice if Canada had a similar law requiring these funds. These are determined by the SEC I think, not some class action lawsuit law firm.


I suppose I confused brokerage with the exchange

I was able to fill out the form and upload my questrade statements. Also bought 100 shares during that time

Fingers crossed I guess


----------

