What happened

Shares of General Electric (NYSE:GE) traded up more than 4.5% on Monday as Wall Street continues to digest -- and applaud -- the industrial conglomerate's third-quarter results. Barclays analyst Julian Mitchell chimed in on Monday, saying that after a lack of worrisome surprises in the recently released results, the bull case for the company is becoming clearer.

So what

A series of ill-timed acquisitions and a debt-laden balance sheet have crippled GE in recent years, sending shares down more than 90% from highs reached in the late 1990s and causing the company to announce a series of CEO changes and a number of divestitures. GE's image took a fresh hit earlier this year when a prominent short-seller called it "a bigger fraud than Enron," warning of potentially devastating surprises lurking on GE's balance sheet.

A LEAP aviation engine on a test platform.

GE's LEAP Engine, part of the company's impressive aerospace portfolio. Image source: General Electric.

GE countered that talk last week by delivering a quarter that beat analyst expectations and, as importantly, lacked surprises or unexpected drama. Healthcare and aviation led the way, but the company's sprawling energy business remains an underperformer. General Electric also raised its guidance for 2020 industrial free cash flow by $1 billion to breakeven to $2 billion, despite headwinds including a slowing global economy and the impact of the grounding of Boeing's 737 MAX.

The turnaround work is far from over at General Electric, in part because that energy unit will be difficult to restructure and could lag for some time. But Barclays' Mitchell, who has an overweight rating on the stock, noted before markets opened Monday that there were "no nasty surprises" in the quarter but instead "some clear signs of progress."

Now what

General Electric had a credibility problem, and CEO Larry Culp, on the job for barely a year, is slowly making progress in restoring investor trust. This remains a long-term turnaround story fraught with potential dangers, including issues should the U.S. fall into a recession. But GE shares, priced at barely 10 times earnings and less than 1 times sales, have been valued as if a catastrophe is imminent.

Following last week's earnings report, a catastrophe seems a lot less likely. That alone seems to be enough to give long-term value investors a reason to take a fresh look at the shares.