General Electric: Regaining Iconic Stature
By Tom Armistead:General Electric (GE) suffered a serious loss of prestige as a result of its near death experience during the financial crisis. Heroic efforts by both Uncle Sam and Uncle Warren were required to ensure survival of a company that at the time enjoyed the coveted triple A rating. GE has since repaid its benefactors, and has been making fine progress in restoring its reputation and stature.At a recent price of $19.36, and sporting a dividend yield of 3.51%, patient investors are likely to be rewarded with share price appreciation, provided the company continues to perform and the market eventually grants it some measure of its former respect.
Using actual earnings for 2008-2011, and estimating 2012 at $1.57, five year average EPS works out to $1.37. Applying a multiple of 20 to that metric, a target price of $27 emerges. If GE reaches that goal in 3 years, theComplete Story »