GE Aerospace (GE)

This is a great buy. In the last 6-12 months, they have gotten rid of GE Capital, which was the negative in 2008-2009. They have reinvented themselves, not just with the big turbines, jet engines, etc., but have bought in service contracts as well. This is going to be a company that sells you a jet engine, etc. and then sells you all the software that goes with it. They are going to make a lot of money off the software and servicing side of things. It will become a bit of a cash cow over time as they sell all this heavy equipment. Dividend yield of 2.97%.

It is in the process of spinning off GE capital. He has hated it since the last change in management in 2001 They are finally getting rid of GE capital He suspects his model price will move up considerably once GE capital goes away. Their competitor is trading well over EBV +5.

He does not own it because he does not focus so much on this large a capitalization stock. It is modestly priced and they divested themselves of the financial business.

Owned this some years ago, but basically lost patience. In Jeff Immelt’s 15-year tenure, the revenue per share, the cash flow and the earnings have been flat. He would not be an owner of this.

It has been transforming itself. It was a financial services power house until the financial crisis came. It is going back to being more of an industrial company. The market is starting to reward this company. They are now increasing their dividend on a regular basis. There is a temporary negative on the stock from their energy exposure.

For a long term trade? It is a meat and potatoes type of name. They went through quite a considerable change of business, getting more into industrial and energy. They aggressively sold the financial assets and are investing it into the more industrial type of space. You might want to make sure they are sending the money so as to be more accretive. He is not in a rush to buy it. Take a half position here at most. The 3% dividend is attractive. It all depends on the quality of acquisitions they can identify.

Likes this. The company is undergoing a very positive transformation in shedding away their financial non-core assets. They are going from about 80% financial too much less. Trading at 19X forward earnings with a 10% growth rate. Not too expensive in terms of valuations. Pays a nice dividend.

It behaved differently than the other industrials during the last year’s correction in the sector. They are going to wind up with additional free capitals to buy back shares and increase dividends with. The sector is now recovering. 7-8% of revenues are from the energy space.

Very little movement in terms of revenue growth or earnings growth. Has been up and down for a variety of reasons. The company has not been well-managed over the last 15 years.

Trading at 19X forward earnings, which is a little rich for him. Likes that they are getting out of the financial services business and are buying back stock. He likes industrial areas which are struggling because of the energy space. Likes the healthcare space that they are in. Would be very happy owning this because it is a well-run company that has gone nowhere for a long, long time. Thinks the dividend is safe.

You should crystallize a dollar play if you own it. There was an earnings surprise. They are good stewards of capital. There was reasonable movement on the stock. Most of the portfolio rationalization has come through. Take profits if you have owned it for a while.

Have done some great things in restructuring. It was a wonderful story for the 2^nd half of 2015. Thinks you are okay to hide out here. Probably wouldn’t be jumping in now, given the huge move that it has had.

Now primarily an industrial company having sold off most of their financial division. Just reported, and by the reaction of the market it looks like there was a bit of a disappointment on guidance. They have programs where they want to become more efficient in their industrial operations, whether on the aviation side, wind turbine or their compressor business. He was buying at around $25, but was lightening up at around $30.

The consistent bellwether on the US economy. It continues to move along in the same way as the rest of the market. Sold his holdings in late 2015 in order to move into some other names. He likes the name longer-term. Valuation has started to get a little bit stretched. There are other names, such as Southwest Airlines (LUV-N), that he would prefer.

Has done quite well relative to the market and its industrial peers. Selling off their financial assets, about 10% of their overall revenues, and redeploying that capital through buying all industrial assets, as well as buying back a lot of stock. She has a target price of about $33 on this, and would want about a 15% return, so it is starting to get attractive. It’s on her watch list. Dividend yield of about 3%.