Barclays Analyst Sees Positive Outlook for General Electric (GE)

A Barclays analyst reported positive expectations for technology and financial services company, General Electric Company(GE) Tuesday.

The analyst from the firm, Scott Davis reported that he belives that after last months 12% decline, with a 5% fall in the XLI, and 7% in the S&P, GE is finally done falling.

Davis commented, “the main potential catalysts for outperformance from here include: sector-high dividend yield, above-sector-average share repurchase, and less macro sensitive end markets – notably gas turbine service and OE, aircraft engines, medical, and oil/gas,” the analyst comments. “In addition, we still believe that GE will sell or JV large blocks of GE Capital, de-risking the portfolio. This part of our thesis has not played out yet but seems inevitable over the next year or so. Shareholder pressure will escalate on this issue. In this note, we review our thesis and potential timeline for value creation.”

He believes that GE’s current 3.4% dividend yield is at an important level and has a good chance of increasing to 3.7% to 3.8% after their dividend is paid.

General Electric shares were mostly flat during premarket trading Tuesday.

The Bottom Line
Shares of General Electric (GE) have a 3.29% dividend yield, based on last night’s closing stock price of $20.66. The stock has technical support in the $18-$19 price area. If the shares can firm up, we see overhead resistance around the $22-$23 price levels.

General Electric Company(GE)is not recommended at this time, holding a DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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