More Bad News From Jeff Immelt's GE

Friday's Wall Street Journal carried an article recapping the details of f/ailing industrial conglomerate GE's inept CEO, Jeff Immelt's excuses for lowering the firm's earnings outlook.

By now, I've written so many pieces about GE that it is better for me to simply recommend readers go the 'GE' or 'Immelt' label on this blog to read them.

Suffice to say, though, that if GE didn't have its huge financial unit, it would not have experienced such a severe recent decline in its stock price and, its total return.

As the nearby, six-month, Yahoo-sourced price chart for GE and the S&P500Index illustrates, the firm's exposure to the current financial services sector turmoil has cost its shareholders plenty.

The firm's shareholders have lost some 30% just since April.

Good work, Jeff! You've managed to vastly underperform the index during that period.

Looking back over the past 12 months, Immelt has lost nearly 40% of his shareholder's value, while the index lost about half that.

How much damage to GE's total return and equity will it take for Immelt to finally realize that breaking up the firm will allow shareholders to pick and choose the sectors in which they wish to invest with parts of the current GE, and what corresponding risks they wish to undertake?

There are several businesses in GE's portfolio that would not, on their own, suffer so badly as GE's financial units. But, thanks to Immelt's insistence on keeping these units needlessly shackled to each other, shareholders don't get to select which they wish to own, and which they do not.

It's likely that, somewhere in GE's business portfolio, there are units which have not lost 40% of their value in the past 12 months.

Thanks to Immelt's poor stewardship and lack of leadership of GE, his shareholders won't get to know which those are, and benefit from their performance.