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GE Q3 earnings expected to dip

General Electric's CEO paints an optimistic picture for the years ahead while markets crumble.

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Source: Bloomberg

On Friday 17 October General Electric is due to post its third-quarter figures before the US markets open. Adjusted earnings per share are expected to fall to $0.373 from $0.39, while sales for the third quarter are projected to rise from $36.23 billion up to $36.92 billion. These improving sales should contribute to the company’s pre-tax profit increasing up to $3.898 billion.

Recent statements from CEO Jeffrey Immelt pointed towards better times being just round the corner for the technology and financial services company. Specifically, he was hopeful that an extra $5 billion in yearly sales would be generated between now and the end of 2017. After spending $1 billion on facilities in Silicon Valley over the last couple of years, aimed at tapping into new threads of internet usage, it looks like the company’s patience is finally about to be rewarded. These developments should also see further tie-ups with both Intel and Cisco improving the company’s diversification.

Shares in General Electric have fallen by 14.6% since the beginning of the year; however they are only slightly lower than they were 12 months ago. If the lows from 12 months ago, around $23.50, do not hold then a retest of the $23 level could materialise. Considering the weak state of global equity markets the negative pressure looks likely to remain.

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