Four years ago, investors were only willing to pay 7.1 times trailing free cash flow for a share of General Electric (NYSE:GE). Today, the price-to-free cash flow ratio is a kingly 17.6. Without this impressive ratio expansion, GE shares would not have been able to keep up with the company's fellow Dow Jones Industrial Average (DJINDICES:^DJI) members.

What's going on with GE's cash flow, and why are investors willing to pay a much larger premium?

GE Chart

GE data by YCharts.

First, you should know that General Electric isn't just an industrial powerhouse. Owning GE shares is also much like investing in a very large bank. GE Capital accounted for 30% of the conglomerate's total revenue last year, or roughly $44 billion. The financial arm provided $115 billion of loan capital to companies, municipalities, and infrastructure projects, and another $105 billion to American consumers.

Compare this to fellow Dow member JPMorgan Chase (NYSE:JPM), whose commercial banking division recorded $7 billion in 2013 revenue on $137 billion in total loans under management. JPMorgan's consumer segment holds $289 billion in total consumer credit, excluding credit card balances.

Any way you slice it, GE plays in the same league as JPMorgan Chase. In some ways, it's a more efficient banker than the traditional too-big-to-fail money center bank.

As such, GE took a bank-sized hit from the 2008 financial crash. On top of that, the company's industrial operations also suffered from the lack of life-giving capital in the global market. With these factors in mind, it's no big surprise that GE took that disaster harder than most companies -- and stocks. General Electric investors even envied JPMorgan shareholders for a while.

GE Chart

GE data by YCharts.

In recent years, General Electric has undertaken a massive makeover. The company is selling off noncore operations bit by bit, including several banking operations abroad. The NBC Universal media operation is long gone, replaced by a bevy of profitable aviation and oil-field services acquisitions.

Investors who want a bank can still buy something like JPMorgan. But there are few alternatives to GE as a global giant of heavy industry. And these days, the company is showing a real commitment to what it does best, moving away from nonessential distractions and risky banking.

Long story short, General Electric is emerging as a new kind of company. Heavy investments today are building a stronger cash machine for the long run, and that's why GE shareholders are prepared to pay a bit more for each dollar of today's cash flow.

The new GE is a leaner, meaner, and more focused giant than the old one. This long-term cash generator is simply worth a bigger premium nowadays.

Anders Bylund has no position in any stocks mentioned. The Motley Fool owns shares of General Electric and JPMorgan Chase. Try any of our Foolish newsletter services free for 30 days.

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