GE’s earnings are both good and bad
TEXT OF STORY
GE reports third-quarter earnings this morning. The company’s expected to make a profit, though earnings are likely to be down over the same time last year. GE is a complicated blend of businesses, and that means some parts of it are doing better than others, as Ashley Milne-Tyte reports.
Ashley Milne-Tyte: GE is really a few companies rolled into one. Analysts are worried about GE Capital, its finance unit. For one thing it holds a lot of subprime mortgages — in the U.K., rather than the U.S.
Morningstar analyst Daniel Holland says that’s not all. He says GE Capital does normal bank stuff, like lending money to other companies.
Daniel Holland: Or to um, help out with financing inventories, leasing jet aircraft, things like that.
And like other banks, it’s taken a big hit during the recession. On the other hand, even though demand for heavy equipment has fallen…
Holland: Their gas-turbine business is doing really well. They’re in the top, you know, in the top two or so of wind-turbine manufacturers, and they stand to benefit.
GE stands to get billions in stimulus money for its green technologies within a few years. And Holland says the company’s industrial side should prosper in the next decade.
I’m Ashley Milne-Tyte for Marketplace.
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