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General Electric Company (GE) Announces Q3 Results: Analysts Reiterate Bullish Ratings

By Christine Brown

Last week, General Electric Company (NYSE:GE) announced its Q3 2015 results.  The company posted EPS of $0.29 cents on revenue of $27.9 billion. These figures were lower than analysts’ expectations of $0.26 cents and $28.7 billion, respectively.  Analysts Jim Corridore of S&P Capital IQ and Robert McCarthy of Stifel weighed in.

Corridore maintained a Buy rating on the stock with 12-month price target of $34. The analyst commented on the price target, explaining, “This is above industrial peers and the S&P 500 reflecting GE’s leading global position and ongoing global restructuring which should lower share count and lower company risk profile.”

Corridore concluded, “We raise our ’15 EPS estimate to $1.30 from $1.29. GE Q3 EPS of $0.29 vs. $0.38 missed our $0.33 estimate but beat that Capital IQ consensus of $0.26. Revenues were weaker than our forecast, but operating margins continue to expand. GE’s transformation is ahead of plan in our view.”

According to TipRanks, Jim Corridore has an overall success rate of 50% (out of 48 ratings), and has earned an average return per recommendation of 11.5% when measured over a one-year horizon and no benchmark.

Stifel’s McCarthy is also bullish on the stock, reiterating a Buy rating with a price target of $30. According to the analyst, the positives for the company include solid progress on GE Capital’s exit plan, capital verticals EPS on track for $0.15, and the share exchange of Synchrony (the company’s former retail lending unit) set to begin next week. He continued, “Margins more resilient than expected… Stock has been solid outperformer October to date, so some modest underperformance would not be a surprise.”

However, the analyst does acknowledge some negatives, including, “Industrial organic orders down 23%. Slower growth in [revenues;] Power and Water weaker than expected revenues.” He also noted, “Orders growth a concern even given difficult compare.”

Robert McCarthy has a success rate of 33% and an average loss per recommendation of -1.9% when measured over a one-year horizon and no benchmark.

According to TipRanks, out of 9 analysts who have recently rated GE’s stock, 7 have rated it as Buy, 2 have rated it as Hold, though none of the analysts have given a Sell rating. Based on ratings of these 9 analysts, the average consensus price target for GE’s stock is $31.38, an upside of 8.28% over current levels.