GE Will ‘Unlock Higher Valuation’ by Shedding GE Capital, Analyst Says – TheStreet

Update: 04/10/2015

This has been the best day for GE in almost a decade. The company has been moving along with its plan to turn GE back into a pure industrial play. With today’s news, that plan is even more defined. It seems that Immelt has decided to bypass the 25%/75% industrial/finance mix and move to basically a pure play industrial GE. Synchrony has yet to be completed, and Alstom is still in limbo. The appliance deal is not yet completed and the sale of most of the real estate holdings has not even taken place- and now, GE Capital is going to be dissected off of the GE conglomerate.

It seems that GE will still be some sort of conglomerate, but it will not have the designation of being treated as a bank by the government. All of the oversight regarding banks will be eliminated. That is exactly what everyone has been asking clamoring for in the past few years. The news was overwhelming, and the stock was rewarded in the last 2 days.

I am more than positive that GE will benefit from these moves and the shares will be pushed higher. How high is another story. However, it has hit multi-year highs today and closed higher even after taking into consideration all the past dividends that were paid. That is a very nice outcome. Those who shorted the stock might desire to cover and lend a little fuel to the upside. Also, institutions might start picking up some shares while they still remain attractively priced.

It has been a long time since I had a one day gain like this. It feels like I hit the Lottery. I never booked any of the gains, and plan to let it ride for the forseeable future. It may play out to my benefit, and then again, it may not. In the grand scheme of things, I am in this for the long haul. Hopefully, GE’s time to shine has come. Regardless, I am going to enjoy the rest of this day and the week end.

This month has been quite a ride for me. It started out extremely bad and got worse, but today was the salve on the wound. I feel like all the weight has been lifted. These are the kind of days I have dreamed of my entire life. It sure feels nice to see things start to come together.

Good luck!!

Keep cranking,

Robert the DividendDreamer

I have been working all morning, but when I saw this in the early morning hours this was very welcome news. This was the thing I have been waiting for many years now. Hopefully, GE can put the plan into action and unlock potential that has been built up over the last decade. This is what the investment community wanted, so they ought to start rewarding GE for its efforts. We will see how it all plays out. But, as of now, I am a very happy investor. Back to work. Have a good weekend!

Keep cranking,

Robert the DividendDreamer 

About dividenddreamer

Doing what I can to make the best of today and the most of tomorrow.
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4 Responses to GE Will ‘Unlock Higher Valuation’ by Shedding GE Capital, Analyst Says – TheStreet

  1. TwoInvesting says:

    The funny thing is that yesterday I actually sold my MCD shares and used the proceeds to buy 130 more shares of GE! Now I’m just hoping that it stays lower for a bit so my reinvested dividends can buy more. I agree that this is a good move for GE.

    • I have been completely broke lately. I wanted to use the upcoming dividends but they are coming too late for me to be getting in at 25 like I wanted. With this big jump, things are nice, but who knows where it goes from here. I would not mind up. Either way, the dividends should be OK and who knows as far as a special dividend goes.

      Keep cranking,

      Robert the DividendDreamer

      • TwoInvesting says:

        I wish GE returns some of that money from the sale of GE Capital to us in the form of dividend increases and/or special dividends, rather than just buying back shares. Though, I’d rather have them buy their shares back now when it is still cheap.

      • They never buy back on the cheap. No company does. However, all the buying will drive the price higher.

        Keep cranking,

        Robert the DividendDreamer

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