Tuesday, April 29, 2008

GE On The "Raging Bull"- What Don't They Get?

I have received quite a few visits from this referring site lately. Evidently, due to my posts over the past several years regarding GE, its current CEO, Jeff Immelt, and the man who selected him for this role, retired GE CEO Jack Welch, some of the denizens of this stock message board found my blog and those related posts.

Over the past few months I would see this referring URL occasionally. However, with the recent frenzy over GE's missed earnings number, Jack Welch's comments on the event, my appearance on Bill O'Reilly's program dealing with GE, Immelt and Iran, and the company's recent annual meeting, the number of visits from this message board have picked up in frequency.

Here is what the latest linked page of comments between various posting readers on the message board says (my emphasis in bold),

"Your post got me thinking about a link that I posted not too long ago. It is "The Reasoned Sceptic". I will add the link a little further on. When GE went down, I thought The Reasoned Sceptic would do a writeup on GE/Immelt/Welch. Think I checked too soon after 4/11/2008 and found nothing new. With your post, I checked The Reasoned Sceptic today and found some rather interesting and uncomplimentary information about GE/Immelt/Welch. When you go to the link, scroll down the right side and look for these listings:

GE (25 writeups)

Immelt (19 writeups)

Jack Welch (5 writeups)

- The writeups at The Reasoned Sceptic, the last time I linked to the site, sounded believable. With GE coasting along, you might not really know what to believe about GE. With the miss by GE the writeups seem to have more weight! - The newer writeups were also troubling. You will have to go to the link and do some reading...you really do not want me to explain...this post may get long as it is. It will take some time...but worth reading. As Naz mentioned, read when you get your coffee or tea or whatever you like on the weekends.

- After reading "The Reasoned Sceptic", looking at the YAHOO chart of the GE/funds and the Excel chart of data...here are some thoughts on GE:

1. GE is in a predicament for this year. What will happen if GE "does not" do better than the S&P 500 or get back to last year closing price of $37.07? GE "just might" be the best place to be this year?

2. You would expect Jeff and the board to be pulling out all the stops to make GE move. If not, GE will come under much "greater" pressure! No excuses will fly this year if the market goes up and GE does not!

3. "IF" GE does well this year, maybe Jeff will save his job for another few years? If a CEO change is going to happen, it will take some time. For now, expect GE to continue in its current form.

4. If GE were to finally break up its current structure, "that" will also take some time. Whatever "might" happen to GE, you are looking at one to two years... All depends on how high Jeff can make GE jump this year...in more ways than one.

5. GE is moving very well as of Friday! They lag the market and need to first "catch up" to the market. After that, will GE continue to $42.12 like last year or better? GE needs to make a statement this year and finish with a "BANG"...and I do not mean Jack with the "gun"...then again...

6. It is easy to follow GE on the YAHOO chart with the five funds. I have added all the funds from the GE 401K for more detail and they all are "index funds" or represent the market. GE needs to mix with the funds or "lead" some...if not all going forward.

7. GE has not really been strong through the middle of the year...and last year is questionable to me. It does try to finish the year up. Will there be a run up from here going forward or a year end run up? Just have to look each day!!!

Hope all the links work and "don't" miss "THE REASONED SCEPTIC". May "rattle your cage" on GE, but says a lot that slowly got to me over the years. As mentioned, GE is just a choice...that I have not used very often. It would be a surprise to see GE do very little this year... Look at the links and do some reading. Any and all information on GE is a help if you are in GE or plan to be in GE. "

Here's what I don't understand.

First, how can these readers use terms like 'sounds believable,' or 'interesting and uncomplimentary information,' and 'may rattle your cage on GE?'

All of my posts are based on real performance numbers in the market- total returns and/or price changes of GE, the S&P500, or United Technologies. None use forward-estimates.

One or two have used GE fundamental information from its income statement, in order to compare its performance with benchmarks from my own proprietary research, as well as with the S&P500.

Of course, I do include Immelt's compensation numbers from the Wall Street Journal and, on perhaps one or two occasions, Forbes.

What's not to believe? And be upset? Why? It is what it is. GE has performed badly for shareholders under Immelt, who has been paid more than $20MM in cash, plus another $100MM or more in deferred compensation, and there's just no getting away from that fact.

Second, in what alternative universe are these 'investors' living? They write comments about Immelt and the board really having to 'pull out all the stops,' or makeup in one year for all of Immelt's prior mediocre performance. They toss numbers which I assume are hypothetical GE stock prices around like they have magical properties. As if Immelt or the board can make the buyers and sellers of the company's stock arrive at some magic number, to the penny.

As if, indeed.

Finally, these people chat about GE stock like it's the only investment vehicle in the world. For God's sake, people, have any of you heard of the S&P500?

Quit wasting your time kvetching about the stock of some low-growth industrial conglomerate has-been, and, if nothing else, go put your money into the S&P. On the basis of nearly seven years of data, chances are you'll earn a better total return there than in Immelt's GE.

But, what do I know? I just stick to the numbers and write about what I see.


Anonymous said...

C Neul,

Recently, I came upon your site and posted the link on Raging Bull.
Seems several decided to see your site...that is great!
My views on GE have changed over the years. I try to be neutral and not beat GE "too" much. I did work for GE over 40 years.
Your site says a lot that I have thought about since Immelt replaced Welch...much better...and more factual.

Your mention of much of one of my posts was a surprise and not a problem.
Think we both agree on GE. You from a higher level and myself from a lower level.
Would be interesting to discuss Raging Bull and GE with you, but not sure if here is the right place.
I have an email that you could reply and I would send further information and a copy of an Excel chart that I often mention on Raging Bull...might interest you.
Recently retired in January from GE and have followed GE for many years. Like to think I have simple ways to follow GE and funds in the GE 401K.
Raging Bull is where many who work for GE or have worked for GE gather and discuss GE.
Many switch between GE and MM.
Many may now also consider GE 401K funds more than they used to.
I have been pushing the funds in the GE 401K as alternate choices for switches.

Enough for now.
Like to talk further.
Email: race2gain@aol.com

Thank you for the mention of Raging Bull.


C Neul said...


Thanks for your extensive comment. Please feel free to email me at the address on this blog and we can discuss this further, if it helps you and your colleagues.