Aerospace and power generation leader, General Electric (GE), recently experienced a downgrade from Oppenheimer analyst Christopher Glynn. Although this downgrade hasn’t had a significant impact on the stock, it highlights the current robustness of investor sentiment.
Glynn downgraded GE stock from a Buy to a Hold in his Monday update. While he didn’t provide a specific target price for shares, according to FactSet, his reasoning was rooted in valuation. He acknowledged that recent gains were fundamentally based. In fact, back in late 2020, Glynn had even upgraded the stock when GE shares, adjusted for the GE HealthCare Technologies (GEHC) spinoff, were trading near $70. As of Friday’s closing, they were valued at $114.39.
Despite the downgrade, the market has taken it in stride as premarket trading on Monday saw GE stock up by approximately 0.2%, while S&P 500 and Dow Jones Industrial Average futures each experienced a 0.1% increase.
At present, around 60% of analysts who cover GE shares still rate them as a Buy. This Buy-rating ratio surpasses the average ratio for stocks in the S&P 500, which is approximately 55%.
The average analyst price target for GE stock stands at roughly $125 per share, indicating an increase of about $14 per share from the recent past when it was around $111. Strong second-quarter results that exceeded expectations have been well-received by both analysts and investors.
GE reported earnings of 68 cents per share from $15.9 billion in sales, surpassing Wall Street estimates of 46 cents per share from $14.8 billion in sales. Following the release of these numbers on July 25, GE stock has since risen by approximately 4%.
Year-to-date, GE shares have seen impressive growth of about 75%. Similarly, shares of GE HealthCare Technologies have increased by approximately 33% so far in 2023. GE HealthCare was spun off to GE shareholders at the beginning of this year.
