General Electric announced Tuesday that it has reached an agreement that would allow it to offload 166 million shares in oilfield services firm Baker Hughes. The transaction would help GE raise around $4 billion (estimated at current stock price of Baker Hughes).
The announcement comes a day after GE CEO Larry Culp told CNBC he felt a “sense of urgency” to fix the mounting debt problems of the conglomerate, and one of the ways he suggested to do that was to sell off GE’s stake in Baker Hughes. It was only last year that GE had completed buying a majority stake in Baker Hughes.
Under the agreement announced Tuesday, GE can sell up to 101 million shares of Baker Hughes, while the latter has agreed to repurchase about 65 million of its shares from GE. After the sale, GE's stake in the oil firm would come to a little above 50% (versus the existing 62.7%). The transaction is expected to be completed by fourth quarter. The new agreement also subjects GE to a 3-month lock-up period that prevents it from any further selling of Baker Hughes shares unless the underwriting banks consent.
After the lock-up period ends, GE might eventually try to sell all of its holding in Baker Hughes.
GE's Aroon Indicator triggered a bullish signal on June 02, 2023. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 269 similar instances where the Aroon Indicator showed a similar pattern. In of the 269 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at .
The Momentum Indicator moved above the 0 level on May 17, 2023. You may want to consider a long position or call options on GE as a result. In of 85 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for GE just turned positive on June 02, 2023. Looking at past instances where GE's MACD turned positive, the stock continued to rise in of 43 cases over the following month. 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 293 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 55 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 .
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 .
GE broke above its upper Bollinger Band on May 17, 2023. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating outstanding 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 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 77, placing this stock better than average.
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 Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly 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 (3.640) is normal, around the industry mean (7.489). P/E Ratio (14.599) is within average values for comparable stocks, (44.548). GE's Projected Growth (PEG Ratio) (3.352) is slightly higher than the industry average of (2.120). GE has a moderately low Dividend Yield (0.003) as compared to the industry average of (0.021). P/S Ratio (1.479) is also within normal values, averaging (11.855).
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average 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 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
A.I.dvisor indicates that over the last year, GE has been loosely correlated with OTIS. These tickers have moved in lockstep 48% of the time. This A.I.-generated data suggests there is some statistical probability that if GE jumps, then OTIS could also see price increases.