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General Electric Co.
INTRODUCTION
If the company is familiar with its position, it can address the issue, as could be
chan...
General Electric Co.
SWOT analysis is a strategic planning method used to evaluate the Strengths,
Weaknesses, Opportunitie...
General Electric Co.
Exihibit 1 SWOT analysis of General electric
Strengths Weaknesses
Partnership with governments across...
General Electric Co.
COMPETITORS
Exihibit 2: Direct Competitor Comparison
C = Citigroup, Inc.
PHG = Koninklijke Philips El...
General Electric Co.
Top Competitors Performance Comparison: GE
Exihibit 3:Top Competitors Key Measures: GE and C
General ...
General Electric Co.
Value on a GE stock based on the market value of the issuer's assets and the outlook
for its earnings...
General Electric Co.
GE business model is founded on three pillars, and to make money, that was ethically
and make a diffe...
General Electric Co.
Capital Finance revenues decreased 15% y-o-y to $12.5B, driven by a lower asset
base (down 6%) of $53...
General Electric Co.
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Analysis of General Electric

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SWOT analysis

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Analysis of General Electric

  1. 1. General Electric Co. INTRODUCTION If the company is familiar with its position, it can address the issue, as could be change. Keeping you both can get an idea of how, for certain activities change company's market position. This may, consequently, promote the creation of new ideas. Analysis strategic portfolio thus to facilitate thinking, thinking forward-looking. It is also a means of communication because through it, can share some strategic issues to others in the company, which is involved in strategic planning. The importance of such analysis is that it allows you to preview the status of the company (or major competitors) in a particular market. Similar analysis of the majority will force senior managers to think about their own market position not only in the time, but also in the future, possibly also in connection with major competitors from. It is actually diagnosis on its own market position. 1
  2. 2. General Electric Co. SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the General electric business identifying the internal and external factors that are favorable and unfavorable to achieve that objective. 2
  3. 3. General Electric Co. Exihibit 1 SWOT analysis of General electric Strengths Weaknesses Partnership with governments across the world Price point is higher as than average due to manufacturing process and fulfillment costs Focus on the process with changes of governments regulatory Decision making process can not be instant Improved incentive programs for renewable energy Credit Losses and Reserves down Infrastucture and human resource development programs Lower advertising and local television markets Improved conditions - Sustainable Leadership Program, Colombia, Serbia, Yemen Financing businesses in commercial lending & leasing Improved healthcare system efficiency in the United States and internationally Produced a training module to educate business leaders on human rights in business contexts Monthly, quarterly reports for shareholders Opportunities Threats Developed local technologies in emerging markets - India, China, Russia, Brazil, Middle East and Africa. Costs of row materials may continue to rise Expand ecomagination products and services Attacks, penalties, loss of reputation for mistakes in business Increase investments in cleaner technologies - reduced greenhouse gas emissions Decline of market value - changing stakeholders needs Risk of loosing experienced stuff Number of global suppliers is increasing - outside from U.S. Changes in government policies - discrimination law, consumer law, antitrust law, employment law, and health and safety law Trend of regulation of international trade - incerease taxes Increased interest rates, exchange rates and the inflation rate cost of capital 3
  4. 4. General Electric Co. COMPETITORS Exihibit 2: Direct Competitor Comparison C = Citigroup, Inc. PHG = Koninklijke Philips Electronics NV SI = Siemens AG Industry = Conglomerates Source: http://finance.yahoo.com/q/co?s=ge, 21.5.2011 GE C PHG SI Industry Market Cap: 208.08B 119.80B 26.16B 113.58B 45.52M Employees: 287,000 260,000 117,246 348,000 3.66K Qtrly Rev Growth (yoy): 6.20% -1.30% 5.50% 7.20% 14.90% Revenue (ttm): 152.46B 61.18B 36.77B 113.28B 95.21M Gross Margin (ttm): 37.76% N/A 37.87% 30.16% 36.83% EBITDA (ttm): 31.89B N/A 4.77B 15.42B 7.01M Operating Margin (ttm): 13.31% 19.80% 8.44% 9.97% 4.36% Net Income (ttm): 13.43B 9.30B 2.11B 8.71B N/A EPS (ttm): 1.20 3.06 2.08 8.86 N/A P/E (ttm): 16.36 13.41 13.29 14.68 15.05 PEG (5 yr expected): 1.01 2.58 0.57 0.32 1.20 P/S (ttm): 1.39 1.98 0.74 1.04 1.33 4
  5. 5. General Electric Co. Top Competitors Performance Comparison: GE Exihibit 3:Top Competitors Key Measures: GE and C General Electric Citigroup Valuation Price/Earnings (TTM) 15.63$ 13.51$ Price/Cash Flow 6.11 5.98 Price/Sales (TTM) 1.31 1.21 Price/Book 1.72 0.76 Per Share Data Last Dividend 42.97 0.33 Book Value 11.38 — EPS (TTM) 1.25 3.20 Revenue 149.06 B $ 115.86 B $ Profitability EBIDTA 37.21 B $ 27.26 B $ Operating Margin 21.18% 12.60% Profit Margin 7.80% 9.07% Gross Profit Margin 51.89% — Dividend Dividend Yield 2.55% 0.10% Payout Ratio 42.97 0.33 Annual Dividend (TTM) 1.56 B — Dividend Yield 5 Year Average 3.62% 5.26% Growth Net Income 12.80 B — EPS (TTM) 1.25% 3.20% Revenue 149.06 B 115.86 B PEG 0.96% 2.44% Financial Strength Quick Ratio (MRQ) 7.80 9.07 Current Ratio (MRQ) 1.03 — LT Debt to Equity Ratio (MRQ) 288.45 208.66 Total Debt to Capital (MRQ) 79.40 78.93 ROE 10.22 6.38 ROA 2.87 0.86 ROIC (Return on Invested Capital) 3.30 2.47 Assets Asset Turnover 0.20 0.06 Asset per Employee 2.62 M $ 7.36 M $ Inventory Turnover 5.25 — Source: http://www.dailyfinance.com/company/general-electric-company/ge/nys/top-competitors, 21.5.2011 5
  6. 6. General Electric Co. Value on a GE stock based on the market value of the issuer's assets and the outlook for its earnings = 15.63$, it´s 2.12$ more than Citigroup. A share of the after-tax profit of a GE, distributed to its shareholders according to the number and class of shares held by them. Dividend per share is 42.97$. 37.21 B $ EBITDA margin means how profitable GE is with regard to operations. It´s calculated by taking the company's earnings before interest, tax, amortization and depreciation and dividing it by the company's total amount of revenue. Stocks: price: 19.62 $1 Change: -0.34 -1.70% = goes to down Key to success 1 Source 04:00 PM EDT on 05/20/2011 in USD (NYSE Delay: 15 mins.) 6
  7. 7. General Electric Co. GE business model is founded on three pillars, and to make money, that was ethically and make a difference. Corporate culture developed in each area within the company among employees as well as outside, as shareholders, the third sector. Strategy GE is trying to respond to the challenges and opportunities that it came from. She understands the trend brother more emphasis on Environment and improve the business environment. Challenges The three pillars that characterize GE are: energy and climate change, sustainable health care and community building. These areas are important for growth of the company itself as well as to improve the business environment. GE provides the infrastructure, technology and finances greener prosperity, and also participates in the development of these technologies. Each of these pillars do at a high level, with an emphasis on perfection in every way in this business. GE's emphasis on cooperation with other businesses, government, to contribute to an improvement in their conditions of business in each country. Business is the emphasis on the environment, wealth and security of operations worldwide. GE is convinced that green represents wealth, health. GE contributes to the political debate on creating sustainable health care to low carbon economy. Founded in the United States Climate Action Partnership (USCAP) and involvement with the Intergovernmental Panel on Climate Change (IPCC), we are engaged in an ongoing, solutions-oriented dialogue about the United States, China, India and Brazil to help shape markets that reward responsibility. Enviroment – Climate changes GE continues at reduced GHG emissions and improve energy intensity of pollution. For example GHG emissions down 22%, GHG emissions intensity down 39%, energy intensity down 34 %. And also reduced water use by 30% compared to 2006 levels. GE gave the following commitments in the area of energy by 2015: 50% improvement in energy intensity by 2015, 25% reduction in GHG emissions by 2015, and also wants to continue the reduction of water 25% reduction in fresh water use by 2015.2 Segments results 2 http://www.ge.com 7
  8. 8. General Electric Co. Capital Finance revenues decreased 15% y-o-y to $12.5B, driven by a lower asset base (down 6%) of $537B and lower interest rates. Energy Infrastructure Revenues decreased 9% y-o-y to $10.4B. Segment profits increased 10% y-o-y to $2.2B and margins improved 350 bps to 21.1% (vs. 17.6% LY). Technology Infrastructure Tech Infrastructure sales declined 10% y-o-y at $11.3B. Segment profits decreased 16% to $2.1B, and margins decreased 120 bps to 18.7% from 19.9% last year. Energy Infrastructure Revenues decreased 9% y-o-y to $10.4B. Segment profits increased 10% y-o-y to $2.2B and margins improved 350 bps to 21.1% (vs. 17.6% LY). Oil & Gas: Revenue grew 10% y-o-y to $2.3B with equipment growth of 4% and services up 18%. Consumer delinquencies continue to stabilize, with 30-day+ delinquencies up 140 bps y-o-y and 2 bps sequentially to 8.82%, as North American delinquencies increased only 32 bps to 7.59% compared to a normal 50 bps seasonal swing from 3Q to 4Q. NBCU NBCU reported revenue of $4.3B, down 4% y-o-y, as continued positive results in cable were offset by tough DVD comps in film. Figure 1 Summary of GE 2010 Profit Framework 2308 mil$ 6843 mil$ 7489 mil$ 400 mil$ 2264 mil$ Capital Finance Energy Infrastructure $ Technology Infrastructure Consumer and Industrial NBCU Source: Data from Company reports and Oppenheimer & Co. Inc. Figure 2 Annual Sales and Profits mil $ by Segment, 2006-2012E 8
  9. 9. General Electric Co. 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 Technology Infrastructure Energy Infrastructure Capital Finance NBCU Consumer and Industrial 2010 2011 2012 Source: Data from Company reports and Oppenheimer & Co. Inc. Figure 3 Total Revenue Growth -15,00% -13,00% -11,00% -9,00% -7,00% -5,00% -3,00% -1,00% 1,00% 3,00% 5,00% 2009 2009,1 2009,2 2009,3 2009,4 2009,5 2009,6 2009,7 2009,8 2009,9 2010 2009 2010 Source: Data from Company reports and Oppenheimer & Co. Inc. 9
  10. 10. General Electric Co. 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 55000 60000 Technology Infrastructure Energy Infrastructure Capital Finance NBCU Consumer and Industrial 2010 2011 2012 Source: Data from Company reports and Oppenheimer & Co. Inc. Figure 3 Total Revenue Growth -15,00% -13,00% -11,00% -9,00% -7,00% -5,00% -3,00% -1,00% 1,00% 3,00% 5,00% 2009 2009,1 2009,2 2009,3 2009,4 2009,5 2009,6 2009,7 2009,8 2009,9 2010 2009 2010 Source: Data from Company reports and Oppenheimer & Co. Inc. 9

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