Shares of General Electric (GE -0.65%) rose on Monday, following bullish analyst remarks. As of 11:35 a.m. EST today, GE's stock was up 3% after rising as much as 5% earlier in the day.
Bank of America analyst Andrew Obin recommended that investors buy GE this morning. He sees the industrial giant's share price climbing to $15, or about 15% higher than their current price.
Obin acknowledges that investors were likely miffed by GE's planned 1-for-8 reverse stock split. But he believes GE's simpler operating structure and stronger balance sheet following the sale of its aircraft-leasing business should make it more attractive to a wider base of investors. Better still, Obin now expects GE to generate as much as $6.5 billion in free cash flow by 2023.
Obin isn't the only analyst to buy into GE's turnaround plans. UBS analyst Markus Mittermaier also reiterated his buy rating and $15 price forecast on Monday. Mittermaier highlighted the company's potential to generate increasing free cash, which it could use to pay down debt and further strengthen its balance sheet. In turn, he sees the stock's recent pullback following its announced reverse stock split as a buying opportunity for long-term investors.