In this morning’s Opening Bell Momentum Stocks, General Electric (GE) offered a buy target for longs between 15.55 and 15.65, an area of stronger liquidity. A buy from the pre-market low 15.60, measured to the day high 15.92, is up 2.1%.
Tag Archives: GE
On Deck: GE’s Friday Surprise
General Electric (GE) is due to report its Q1 results in the pre-market on Friday, April 17. Analysts polled by Thomson Reuters expect the company to report a profit of $0.21 per share on revenue of $39 billion. While most of Wall Street has shied away from GE, and for good reason, the time has come for a rebound on the heels of an in-line or upside earnings surprise.
From a fundamental point of view, the company maintains a healthy cash position and increasing revenues from the energy infrastructure and technology infrastructure segments. In addition, the company has signed new contracts and expanded a manufacturing facility in China, improving margins on related products and expanding its foothold in a country likely to become an ever greater economic engine.
The GE Capital credit concerns have been overblown and investors have been stepping back into the stock, pushing it up from staggering lows in the 6’s recent to over $11. There is still time and room to run. With a health dividend yield of greater than 10% and the sector’s lowest P/E, most investors would be wise to get paid while waiting for the stock price to rise.
From a historical price reaction perspective, when it comes to pre-market earnings events GE tends to see follow through gains or losses from the pre-market to the regular session close. In other words, the stock tends to follow-through with the trend that develops ahead of the open.
While we anticipate a positive reaction to any in-line or above estimates results, extended-hours traders tend to be right on with GE. As history shows and from a risk/reward standpoint, its best to just go with the trend.
On Jan. 23, 2009, shares fell 6.1% in the pre-market session after the company reported earnings in line but missed with revenue. The loss fattened to 10.7% in regular trading later that day.
On Oct. 10, 2008, GE rose 0.5% in pre-market trade after posting Q3 results in line with Street estimates. The stock recorded a sharp rise in the regular session, soaring to a 13.1% gain in the Oct. 10 regular session.
On July 11, 2008, GE declined 0.5% in pre-market trade after meeting earnings expectations, beating on revenue, and backing its fiscal year view. The stock turned positive in the following regular session, eking just higher, up 0.07% by the closing bell.
On April 11, 2008, GE tumbled 11.5% in pre-market trade after missing Q1 expectations and setting its guidance below Street estimates. It added to its downside in the following regular session, losing 12.8% by the closing bell.
On Jan. 18, 2008, GE advanced 2.3% in pre-market trade after meeting Q4 expectations and maintaining its 2008 guidance largely in line with the Street view. The stock added to its upside in the following regular session, gaining 3.3% by the closing bell.me stock news and trading ideas FREE for 2 weeks. < Learn More >here.
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Earnings Update: GE, JPM
To follow up on my last post, there is an Interesting post on the Ticker Sense blog which provides a good look ahead at the earnings calendar. You can view a copy of the post here:
Important Upcoming Earnings Reports
Key earnings reports continue through the end of the month. Below we highlight some of the more significant reports expected over the next several days. Historically GOOG and ISRG are some of the more volatile names, and will likely create trading opportunities for those interested in the after hours.
The spotlight is likely to be on JPM and GE on Friday.
Google, Intel, Citigroup Kick Earnings Into Full Swing
Earnings season steps into high gear this week as a number of financial and technology companies report results including Intel Corp. (INTC), Goldman Sachs (GS), Citigroup (C) and Google Inc. (GOOG). Investors will also hear from bellwether General Electric (GE) on Friday.
This week will also give investors an idea about housing and inflation when the government releases the latest report on housing starts and the consumer price index.
Google is one company that investors like to trade going into earnings. On Thursday, the owner of the largest search engine is expected to report first quarter earnings of $4.96 per share, up 2.5% from a year ago, on revenue of $4.09 billion, according to analysts polled by Thomson Reuters. Google shares broke back above their 50-day moving average of $330 on March 20th and have a lot of room to move higher.
Investors trading into Google earnings on Thursday should know that shares lean toward a reversal pattern between the sessions in its long-term performance, cutting back its post-earnings evening share direction in next-day trade in 10 of the last 18 quarterly reports. However, in the near-term, the stock favors widening, extending its evening share move in the next day’s session in three of the last four quarters. On January 22, shares rose 2% in after-hours trading and extended their gains in the following regular session, ending up 5.9%.
On Tuesday, Linear Technology (LLTC) is scheduled to report its third-quarter results after the close and is expected to report earnings of $0.21 per share, down 52% from a year ago, on revenue of $203 million. Over the last 52 weeks, the stock has ranged from a low of $17.69 to a high of $37.77. The stock has been showing support around $22.78 and resistance in the $23.98 range.
Linear likes to widen it’s after hours move in the following regular session, doing so in the past 11 of 16 after-hours earnings releases. The near-term pattern also shows wider moves in the last six consecutive quarters. On January 13, the stock lost 2.6% in after-hours trading and widened its move the next regular session, ending down 4.1%.
Mid Day Relief
After communicating with a friend of mine in the asset management business I come to realize a few things this afternoon I’d like to share.
1. The markets have been equally cruel to big and small investors alike. In the office next door to MidnightTrader, there is a hedge fund manager who used to manage $1.5 Billion (with a B) in assets thats now down to $40 Million (that’s with an “M”). So, if there is any comfort in group misery, you’ll find it like I did without looking too far.
2. Since the TARP seems to be getting larger and fatter with each passing congressional moment, I’ve decided to do seek my piece. No, I’m not a bank but I do have some troubled assets including, but not limited to, my purchase of General Electric (GE) at $20 and more at $16. Unfortunately, I don’t qualify as a bank despite having more debt than cash…(if you’d actually like to see the real TARP application it’s here: http://www.sba.gov/idc/groups/public/documents/sba_homepage/guideline_tarp_capitalpurchase.pdf
3. The major indicies all appear to be in positive territory this afternoon, therefore any reasonable person would deduct that the computer is malfunctioning. However, since the “New Deal” administration has made it more worthwhile to be on welfare than to work, I can’t find any computer repair people. Maybe they’re out building the Internet to nowhere. Oh, that’s just a part of the pork stimulus plan our representatives have added. Not very stimulating is it?
GE Falling Sharply in Pre-Market Trading - Time to Buy?
The sellers are dominant in active pre-open trading on the heels of an earnings report from mega blue chip General Electric (GE).
As reported by MidnightTrader.com a few minutes ago:
GE reports Q1 EPS of $0.44 per share, below Street expectations of $0.51 pe share. Revenue was $42.2 bln, worse than the Street view of $43.6 bln.
The company lowered its full year EPS guidance to a range of $2.20 to $2.30 per share, below the Street view of $2.43 per share.
Q2 EPS is seen at $0.53 to $0.55 per share, vs. expectations of $0.58 per share.
Traders have sold off shares in early trading to $32.60, a level not seen since June, 2006. Using history as a guide, it may be time to take advantage of the fear. GE is recently favoring a narrowing trend between the sessions, cutting back its pre-market earnings-driven percentage performance in the following regular session in three of the last four quarters.
On Jan. 18, 2008, GE advanced 2.3% in pre-market trade after meeting Q4 expectations and maintaining its 2008 guidance largely in line with the Street view. The stock added to its upside in the following regular session, gaining 3.3% by the closing bell.
On Oct. 12, 2007, GE lost 1.5% in pre-market trade after the company met Q3 earnings expectations, beat on sales and guided for its Q4 and full year earnings in line with the Street view. The stock saw its declines reverse slightly during the regular session, closing out that day’s trade down 1.3%.
On July 13, 2007, GE advanced 1.6% in pre-market trade after the company beat by a penny on earnings and set forward guidance in line with expectations. It narrowed its upside in that day’s regular session, rising 1.2%.
On April 13, 2007, GE gained 1.1% in pre-market activity after reporting quarterly results that matched estimates and setting its outlook in a range that straddled the Street view. The stock saw its upside cut back between the regular session bells as GE ended the day with a 0.5% gain.
It isn’t easy going long with so much negative sentiment out there, but therein lies the reward.
