I can only surmise that GE is using this move in order to “Spread the Wealth” throughout the divisions. The moment I saw this article, I knew that it was an absolutely brilliant idea.
The oil segment has taken a beating in the past few months, and who knows when it will eventually turn around. Meanwhile, the other segments have been churning out fantastic progress in the face of slow economic growth. The addition of Alstom has given GE the ability to utilize technology that they were shallow in, and extend GE’s reach into countries where they had no foothold.
By moving a very profitable portion of one division to a division that is in dire straits at the moment will level things out and allow for the oil segment to stabilize as GE moves forward with its turnaround. The two new divisions will most probably encompass segments that are growing enough to justify the “Shell Game.” Afterall, isn’t most of what we see in the market somewhat manipulated. Either a company is stuffing channels in order to book current sales and bulk up EPS, or they are using financial engineering in order to manipulate the float so that EPS are pushed higher. No matter what is being done, the ultimate reason is to drive up the share price.
Hey, as long as everything is legal, and I see improvements in my future dividend income and share price, I am all for it. Wow! That was a mouthful. However, that is how I feel. I firmly believe that a company as ubiquitous as GE should utilize each and every tactic that can possibly be mustered. It is of utmost importance to show, not only to potential investors but to prospective investors, that no stone will be unturned in order to return GE to its former glory. Remember, not that many years ago, GE had the largest market capitalization.
I am more than sure that GE has a full time staff working on making over GE’s image. I am also sure that they are applying every previously successful financial maneuver in the attempt to transcend all that came before.
1. Jeff Immelt finally gets GE to function like a true Industrial company. As a matter of fact, he transforms GE into the preeminent Industrial in the entire world.
2. In the process, he reduces the current share count.
3. He also tightens the reigns and reduces costs to do business and eliminates virtually all waste.
4. He ventures into a completely new Industrial segment called the Industrial Internet……and succeeds!
5. Sways the government to remove that no longer needed SIFI stigma.
6. Sells the Appliance division for more than anticipated.
7. Buys oil and gas assets for less than anticipated.
8. Takes market share in all of its business segments through the use of technologies such as 3D printing FastWorks and a marketing strategy that portrays GE as the only option for companies who are looking to upgrade there current equipment and services.
9. After all of these amazing pieces of financial and corporate maneuvering are in place and running smoothly, he can announce his retirement and be proud of his years at the helm of one of the world’s most valuable brands.
I truly wish this for him. I know he gets paid quite a lot of money, but if he can ultimately pilot this ship to where he knows it can go, he will, most definitely, deserve his compensation. All the while, I would not mind taking that ride with him. I say this because I feel that I am a big part of GE. I am a shareholder, and whether I hold 1 share or 1,000,000,000 shares, I feel that I should reap the fruits of GE’S ultimate success.
In life, everything is relative. My investment in GE could potentially pay off in spades, but regardless, each one of my shares is going to increase or decrease by the same % as every other shareholder’s holdings. The total $ value of the shares will be different from shareholder to shareholder, owever, if GE does return to its former glory, each share would be valued the same. I want to see Jeff Immelt succeed, and in turn, I should succeed. As a matter of fact, all current GE shareholders should succeed. It is truly that simple.
I have gone through the good times as well as bad, and I can truly say it is so much nicer to go through the good. I would much rather accumulate shares at the low, but nevertheless, I am more than happy to see my current holdings move higher. Peltz was looking for a double a few months back, and we are on our way. It is only a double from here away from the all time high. That might seem far fetched, but “Hey! You gotta dream!” Believe me, I have been dreaming lately.
Nevertheless, things are going to happen and nothing is impossible. I have been biding my time, and I am in no rush (no pun intended). I am hoping for the best and wish all fellow shareholders well. Hopefully, Jeff Immelt gets wind of this (pun intended) and realizes that at least one shareholder is looking in the same direction as he is.
Good luck to all!
Happy New Year!
Robert the DividendDreamer
AKA — Seeking Dividends
Follow me on Twitter– Seeking Dividends@DividendDreamer
All comments will be greatly appreciated.
AKA — DividendDreamer