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GE Gains on Credit Suisse Upgrade to Outperform With $122 Target -Breaking

by Mike Robinson

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© Reuters.

By Dhirendra Tripathi

Investing.com – General Electric Stock (NYSE:), traded 3.5% higher on Tuesday, after Credit Suisse gave it an outperform rating with a target price of $122, up 22% over the $100 level.

GE’s shares have lost around 14% since the company’s Nov. 9 decision to split into three businesses – healthcare, energy and aviation. The plan is to retain 20% of the healthcare company.

John Walsh, analyst believes that the pullback in performance has opened up the possibility of outperformance in 2022. GE will reap the rewards of a cyclical recovery 2022.

“We also see potential for a “rush for propulsion” as airline customers have managed green time throughout the pandemic. GE reported in December that the FCF (free cashflow) and aviation revenue would be back at pre-pandemic levels. We think cyclical recovery and FCF execution will drive the stock higher, despite a “lack of catalyst” narrative into the spinoffs,” Walsh said in his note, according to StreetInsider.

Walsh points out, unlike large conglomerate simplifications, GE has positively revised its guidance.

GE wants all three units to be rated investment-grade debt. It claimed in November that its goal was to lower debt by 2.5 times earnings before interest tax, depreciation or amortization by this year. That is the general rule for investment grade corporate debt.

 

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