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General Electric Company (NYSE:GE): Long Term Strengths

Boston, MA 04/11/2014 (wallstreetpr) – With the announcement that General Electric Company (NYSE:GE) has chosen Greater Cincinnati as the location for its new U.S. Global Operations Center, GE will be adding 1,400 much-needed jobs to the Ohio economy. It already employs 15,000 people in Ohio.

Push Into 3D Printing

3D is far from being just a buzzword. It’s helping manufacturers in the real-world revolutionize how they look at design and building processes. 3D printing and additive manufacturing processes in general are saving time and money in development and manufacturing.

General Electric Company (NYSE:GE) wants to remain at the cutting edge of this new technology — with its Rapid Prototyping Center in Louisville, KY and the formation of GE Aviation with the acquisition of Morris Technologies.

With additive manufacturing, the whole process of bringing products to the market can be accomplished faster as it enables faster prototyping.

GE already has hundreds of 3D printers in-house and hopes to print more than 100,000 aviation parts by 2020. Aircraft parts manufacturing is a field that is particularly suited to 3D printing and GE makes 3D-printed fuel nozzles for the aircraft engines it manufactures. It also uses additive technology to repair and service parts in its different turbomachinery businesses such as Aviation, Power & Water, and Oil & Gas.

Spinning Off Retail Finance

It has already announced plans to spin off its retail finance business into a separate listed entity called Synchrony Financial. While during 2008-09, GE was earning more than half of its profits from the financial arm, now Jeff Immelt expects GE Capital to contribute only about 30% to overall 2014 earnings. This will let GE focus on what is its core strength — manufacturing.

Clean Energy

Despite the growth of shale gas, fracking and cheap natural gas, use of solar continues to grow. GE is well-placed to reap dividends from this growth as it is focused on renewable energy apart from making turbines for conventional power plants. It has an ongoing collaboration with and bought a small stake in First Solar, Inc. (NASDAQ:FSLR), which is a manufacturer of thin-film Cadmium Telluride (CdTe).

Benefiting From The Boom in Natural Gas

General Electric Company (NYSE:GE) is also investing billions in building energy infrastructure in North America. Its energy investing arm has invested more than $3 billion in more than 40,000 miles of pipeline, the largest U.S. LNG export facility and other energy storage and transportation ventures. GE is focused on the ‘Age of Gas’ in a big way by investing in gas-powered locomotives, drilling rigs, mining operations and marine equipment.

Russia Sanctions Trouble

The only dark cloud is with the U.S. imposing sanctions against Russia in the wake of troubles in Ukraine, GE has some trouble on its hands — e.g. GE’s aircraft leasing division flies 54 planes in Russia. But that’s clearly a very small part of what GE is about.

Overall, General Electric Company (NYSE:GE) will remain a very strong company. No wonder Warren Buffett bought $3 billion in perpetual preferred GE stock in 2008 with an exceptional 10% annual dividend and he has since increased his GE holdings by a whopping 1,700% during 4Q2013 through Berkshire Hathaway Inc. (NYSE:BRK.A).

Published by Nicholas Maithya

Nicholas is a Financial Analyst by profession, who enjoys writing about investments, technological developments, business, economics and other financial topics at various financial publications. Join him here on Wallstreetpr.com as he endeavors to deliver to you the latest breaking news on the above mentioned fronts. Contact him by email at [email protected] or follow Nicholas Kitonyi @nmaithyak on Twitter.



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