GE raises full-year earnings forecast
By Daniel Tyson
General Electric said Tuesday it has revised upward its full-year earnings per share forecast.
GE, once a cornerstone of American manufacturing, said it now expects adjusted profits for 2021 in the range of $1.80–$2.10 per share, versus earlier estimates of $1.20–$2 per share, according to the company’s third quarter earnings release.
GE also narrowed the expected range for industrial free cash flow to $3.75–$4.75bn from $3.5bn–$5bn and said industrial organic revenue will be flat compared to the previous outlook of low-single digit growth.
The industrial division comprises aviation, healthcare, renewable energy and power.
At the opening bell Tuesday on Wall Street, the Boston-based company was trading at $105.45 per share, but shot up to $108.24 within 10 minutes, a gain of nearly 3%.
Third quarter earnings
During a conference call, chief executive Larry Culp said the conglomerate is facing a “challenging” operating theatre hindered by the global supply chain disruptors, onshore wind markets and the possibility of a hefty tax hike and reduced tax credits under US President Joe Biden’s infrastructure bill.
GE’s third quarter earnings beat Wall Street’s expectation, but it missed forecast.
Total revenue fell 1% from Q3 2021 to $18.43bn (£13bn) while spending was slashed 8%, according to a press release. Wall Street expected a 4% increase in revenues to $19.8bn. Revenues from the aviation division increased 10%, but declined in healthcare (-5%) and renewable energies (-7%). Power revenue was flat.
Adjusted profit for Q3 came in at $0.57 a share, up from $0.38 year over year. Analysts expected GE an adjusted profit of $0.43 per share.
For 2022, the company predicts revenue increase, margin expansion and a higher cash flow.
Read more: General Electric sparking back to life
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