BY MARK SEBASTIAN 

October 26, 2023 

Hey Traders,

We have hit on this stock before, the last time, the stock was in the toilet. This time, the stock is one of the few winners coming out of earnings season.

This is one of the most widely held stock out there. After several years, the stock is finally above its reverse split price, an action that was loathed by many of its shareholders.

This is the company that was built by Welch and destroyed by Imelt. The stock has been trying to recover since the 2008 financial crisis almost took the company apart…

That is right we are talking about General Electric.

The Good.

This is not your grandma’s GE. The company could care less about David Letterman making fun of its cruddy light bulbs (yes they still do make lightbulbs by the way).

But the old parts of this company are not what is driving growth…The appliances, the light bulbs, that is nice, but it is not driving growth. Even the jet engines, a nice source or revenue and growth are not the driver here…GE is now an energy company.

From our insider Frank Gregory: GE is all about Wind and Nuclear now And the K-street is funding it.

The value of an insider, that saw the GE explosion in 2022 cannot be said enough. His traders have been on the inside of GE’s growth for over a year.

GE’s real knock it out of the park part of earnings was not aerospace (which was great)  it was the Grid. GE was profitable in both wind and grid services. With the company working on small nuclear power and being one of the biggest suppliers of wind turbines in the world.

So with all the growth and money flowing into GE, one might expect it to have an inflated PE…after all Green Energy is the rage…but…GE is sneaky green energy, it’s not the headline catching green energy of a TSLA or a PLUG Power.

Thus the company only has a PE of 13.3. Relatively low for a company with high growth. The EPS was great at 8.54 a share and cash flow is phenomenal at 10.61 per share.

The company is sitting on 18.54 of cash per share which is a really nice reserve. It also still pays a dividend (albeit small) of .32 a share.

The raw numbers look pretty darn good.

So what is the bad?

Frank-ly there is not a lot to hate, the company has really shored up its debt situation.


While 19 billion dollars is still a lot the company has more cash on hand than long term debt…that is a good thing.

So how does this company lose…

Purse strings…

There are all kinds of programs incentivizing green energy investing, the inflation reduction act was a huge green energy boon and is just starting to move through the system.  

With government debt at an all time high and growing, if a House, Senate, and President were to all fall republican, I could see the programs that have funded some of GE’s growth coming to a quick end…that is the risk here.

The Verdict.

I think GE with a current market cap of 123 billion has another 20% upside. I would be a buyer, I would do so by selling puts and using the cash to finance upside calls.

Questions about that? Leave a comment below!

Your Only Option,

Mark Sebastian