GE Aerospace (GE)

This is 1 step forward and 2 steps back. Their big problem going into 2008 was the size of GE Capital and got their hand caught in the cookie jar. Have worked hard to pare back that business and consolidate it. He gives them credit for that but they just can’t seem to get everything working together at the same time. Earnings growth is tepid at best. Priced at about 14-15 times earnings. If you own, he would move elsewhere in the industrial space.

Global conglomerate. Financial services part got to be too big and when financial services imploded in the US, it dragged the stock down. It is now less important and they continue to diversify away from financial services. He continues to buy for his new clients. Sees continued upside in the stock and likes the 3.25% dividend yield. Will be raising its dividend on a regular basis.

Great company and with his outlook on the US economy it will do well. Very large part of their business was GE Capital but that is now becoming a smaller and smaller part of it so this will be trading much more as an industrial so you won’t get the huge multiple expansion that they used to have.

(Market Call Minute.) Positive on this. Likes the industrial side. Still viewed as a financial by the market and he is warm to financials.

Very well managed conglomerate. Has been in a quiet restructuring process for 5-6 years and downsizing their GE capital portion. There are other industrials that he would prefer for faster growth. Expect they will raise their dividend this year.

(Market Call Minute) Conglomerates are doing well as are companies into industrial machinery and they are selling a lot of gas turbine engines. All three should be positive for GE. Good dividend yield.

(Market Call Minute.) It would be a wonderful company if they split the thing up.

Just came out with quite good earnings. Bought this when he thought they could increase the dividend. Thinks this company can go into the mid-$30’s. Has a lot of potential. As the economy recovers, this should recover more.

For the past 10 or 12 years have had difficulties. Started as a broad industrial and then in 2008 GE capital suffered. They have been divesting some of their interests to become more concentrated where they do well, but every quarter there is always something that is holding them back. Growth in profits is very, very slow. He felt there was a better alternative. Prefers United Technologies.

If you have a small portfolio and you want broad participation in America, this would be much like a mutual fund. Diversified activity both in the business and financial areas. He has a target of $24 plus, which gives you a 10% return plus a 3.5% yield.

He has owned the debt a couple of times, but not the stock. Not bad to own for their dividend. Slowly removing financial assets from their businesses. It can slowly go up. It’s a well run company. They have the ability to slowly grow the dividend.

Good company if you want a play on the global economy. She targets specific areas so doesn`t buy GE. You can find smaller companies with a smaller niche

Thought there could be dividend increases which there have been since he bought it. He is happy to hold it and thinks it has a lot of upside. Buy under $15

With this you are looking at jet engines, gas turbines, appliances, etc. Industrial space should do well. It is more cyclical and you are seeing more visibility in the capital part of their company. There should be better performance from some of the high-margin businesses which happen to be more cyclical such as the aviation side as well as GE energy. 3% dividend. He looks to see it grow by about 15% over the next 3 years.

Hopes it moves up from here. He is a long term owner. He likes what is going on. Expects more dividend increases.