Bad News Keeps Coming For GE

Bad News Keeps Coming For GE

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by: Jayson Derrick Benzinga Staff Writer

 

Investors who hoped that General Electric Company GE 2.49%'s woes ended with a $6.2-billion charge related to its insurance business were dealt another blow Wednesday. The company said in conjunction with its fourth quarter earnings report that the U.S. Securities and Exchange Commission is opening an investigation.

 

What You Need To Know

GE reported a top-and-bottom-line miss in its earnings report. The company said it earned 27 cents per share in the fourth quarter on revenue of $31.4 billion. This compares to Wall Street analysts who modeled an EPS of 29 cents per share on revenue of $34 billion. Management also guided its full year fiscal 2018 EPS to be in a range of $1 to $1.07, a range within the consensus estimate of $1.

The SEC is investigating the $6.2-billion charge GE took. GE has been made aware of an investigation related to the process "leading to the insurance reserve increase and the fourth-quarter charge as well as GE's revenue recognition and controls for long-term service agreements," CNBC quoted the company's CFO Jamie Miller as saying on a conference call with investors.

 

Why It's Important

GE said it plans on "cooperating fully" with the investigation, which is in the "very early stages," the executive said. But the company may be prompted to restate its 2016 and 2017 financial results based on new accounting, and the results will be released "shortly."

 

What's Next?

GE may be taking an even closer look at major changes to its business structure, which could even result in the removal of the company's stock from the Dow Jones Industrial Average after being part of the index for more than one century, MarketWatch said.

 

Price Action

Shares of General Electric were trading lower by 1.45 percent at $16.80 Wednesday morning.

 

 

Photo by Bubba73/Wikimedia. 

© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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3 responses to “Bad News Keeps Coming For GE”

  1. Angela Baker says:

    In order to keep the company afloat and attract investors, we should work relentlessly. The company TheWordPoint can be a good example for those, who plan to bring their business to the top and deserve the customer`s appreciation. We should take lessons from services and companies that take every effort to achieve success.

  2. instagonline says:

    Thank you for updating the news. Hope they will survive in this hard time.
    instagram online

  3. WRIGHT says:

    Hi,

    RS sent a mail freezing the salary in GE Power.

    In a recent video sent by JF he says employees are always at the centre of the company ahead of customers and share holders. My question to him is if the revenues and profit/loss of businesses are sumned up to give dividends to share holders for "GE Company", why is the salary of one business frozen alone? Its nit employees who have resulted in this mess in Power and "GE" as a whole? Why punish employees from one business alone?

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