General Electric’s shares surged more than 5% on Monday after the Company announced the sale of its biopharma business to Danahar (DHR) for a $21.4 billion all-cash deal. The company also announced its plans to use the cash received from the deal to defray its debts.
According to the terms of the deal, Danaher will pay $21 billion in cash to GE but at the same time it will also assume certain GE pension liabilities.
Expected to be complete by the fourth quarter, the deal is likely to see GE Life Sciences unit is expected to join Danaher’s Life Science as a stand-alone business. GE biopharma unit is expected to generate about $3.2 billion in revenue this year.
After the announcement, GE’s share traded as high as $11.75 in early trading before shedding some gains to close up 6.4% at $10.82 a share. Danaher’s stock also jumped 8.5% to close at $123.15 a share.
GE has already seen yields on its debt bonds fall to low levels along with a decline in risk premium demanded by investors in exchange for holding GE paper. But following the announcement, GE saw one of its most active bonds – the $11.5 billion of 4.418% notes due in November 2035 – jump 2.6 points in price to regain the $0.90 on the dollar level for the first time since October.
GE may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In of 28 cases where GE's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are .
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where GE's RSI Indicator exited the oversold zone, of 17 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where GE advanced for three days, in of 325 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 64 cases where GE's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
The Momentum Indicator moved below the 0 level on December 05, 2024. You may want to consider selling the stock, shorting the stock, or exploring put options on GE as a result. In of 93 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for GE turned negative on December 05, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 55 similar instances when the indicator turned negative. In of the 55 cases the stock turned lower in the days that followed. This puts the odds of success at .
GE moved below its 50-day moving average on November 27, 2024 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for GE crossed bearishly below the 50-day moving average on November 01, 2024. This indicates that the trend has shifted lower and could be considered a sell signal. In of 15 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where GE declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 70, placing this stock better than average.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. GE’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (9.911) is normal, around the industry mean (8.210). P/E Ratio (34.105) is within average values for comparable stocks, (59.547). Projected Growth (PEG Ratio) (1.696) is also within normal values, averaging (2.386). Dividend Yield (0.005) settles around the average of (0.015) among similar stocks. P/S Ratio (2.735) is also within normal values, averaging (7.968).
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a manufacturer of products for the generation, transmission, distribution, control and utilization of electricity; manufactures aircraft engines and medical equipment
Industry AerospaceDefense