General Electric's (NYSE:GE) stock is down significantly, after the company reported earnings last week, and that's coming off of a year of trailing performance.

In this Industry Focus: Energy segment, host Sarah Priestley is joined by Fool contributor Sean O'Reilly to explain how this might be a good time for investors to buy in to the company, and why they might want to make like so much of the rest of the market and keep away. Listen in to find out how GE could grow significantly in the future with their industrial internet products, some of the many reasons so many analysts are bearish on the company's long-term future, and more.

A full transcript follows the video.

This video was recorded on Nov. 2, 2017.

Sarah Priestley: If anybody is looking at GE's stock now and thinking, it's down 35%, would it be a buying opportunity for you?

Sean O'Reilly: Turnaround story. Gosh, it just sunk below 20. I'm looking at it right now. $19.91 as of 11:25 a.m. on Nov. 2. Yowza. Dividend yield 4.8%, is that real? [laughs]

Priestley: Beware of the dividend yield.

O'Reilly: Right. I might need to look at this as a Ben Graham below book value thing soon. That's what makes a market, you have a bull and a bear. So far today, 31 million shares have traded hands. Somebody sold that, and somebody bought all that. Actually, it was probably an algorithm that doesn't care. It's an unknown quantity, but if you're buying the innovation ramp up and the industrial internet stuff, it would be a fantastic bargain. What I'm nervous about and the reason I'm not jumping into the stock just yet for me or my son's education account or anything like that yet is, my read on Flannery and the choice of him was ... they had faster-growing divisions. The time he was at GE Healthcare, 2014 to 2016, they had faster growing divisions in both revenue and profits, why did they pick him? Literally the first thing out of everybody's mouth was the profit margin, operating margin 100 basis-point expansion. He was the finance guy. He actually helped start GE Finance in the 80s. And to me, I would have wanted what Ford has done. They got a hip tech guy from Steelcase. I think they need to go all in on crazy innovation. What I saw was, they picked somebody like me, a finance guy. Awesome with spreadsheets but Eddie Lampert, CEO of [Sears Holdings], he's a finance guy, and you hear these stories about how he would just sit with dual monitors in his office running a Sears with massive Excel spreadsheets. And to me, it seemed to me like you needed to get some fashion people and have them go nuts with inventory.

Priestley: I think you and I have differing views on the stock right now.

O'Reilly: You probably have the correct one. [laughs]

Priestley: I mean, I could have egg on my face as soon as the 13th of November. But, I actually have invested. I think it's priced well.

O'Reilly: It was the dividend, wasn't it? [laughs]

Priestley: It really got me, that 4.8%. And the reason I think this is, Buffett be fearful when others are greedy and greedy when others are fearful. I think this is a prime example of this. And I think if people wait to see how things shake out it may be too late. This company has been around for 125 years. It's a long time. I think management is trimming the fat and appropriately diversifying. I think the crux of the issue for the company is a PR one. GE has historically been a power, oil and gas company, and those businesses are undoubtedly underperforming. And when those three segments fail, GE doesn't work properly in people's minds, and that has led to some panic. So, understandably so, to a degree, these segments contribute about 50% of the revenue. But to put it into perspective, revenue declined 1%, operating profit 7%, and earnings were off by 9%. So, that's bad for GE. You then have these other segments, as you touched on, Aviation and Healthcare posting profit gains, and organic revenue rising 2% for the first nine months of this year. So, I think the situation you have is, it's getting a bad rap because everybody is so focused on these businesses. But, to touch on what you said, if they can invest in innovation, the industrial internet, if they can add services to their installed base, which is huge --

O'Reilly: Which would be awesome.

Priestley: -- if they can monetize that, it would deliver growth. The margins are 30% in that business.

O'Reilly: Oh my gosh. I didn't know that. That's like a SAAS business, software-as-a-service. You're getting money for taking care of this thing that you sold them. It's awesome.

Priestley: Exactly. And if anyone is listening and they're wondering what we're talking about with this internet of things, industrial internet, for each industrial device GE sells, they can add a little sensor that makes the equipment smart.

O'Reilly: Can they put one of those in me?

Priestley: [laughs] I wish they would do it to me, too. It can record a lot of data. It sends it back to GE, it's analyzed, and then GE basically enacts improvement suggestions so it can become more efficient, it can last longer. Basically, the intention is to reduce the overall cost of that product. As we said, their core industrial operation is cyclical, it tracks the economy, and that's why you're seeing the difficulty that they're having right now in Power with the oversupply in the market, and would be depression in stock prices in oil and gas.

O'Reilly: I almost wonder, we just got a good GDP report, annualized basis was like 3%. I wonder if that's good for them.

Priestley: It should be. We're starting to see a pickup in oil and gas now. So, hopefully they'll benefit from that. But, if basically your whole business, which, 50% of their business is tied to economic growth, which is a few percentage points here and there, what could really unlock the huge amount of potential is increasing these service contracts. As we said, it's 30% potential additional margin.

Sarah Priestley owns shares of General Electric. Sean O'Reilly has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Ford. The Motley Fool has a disclosure policy.