Indeed, GE's energy infrastructure activity recorded profit growth of 19% on 7% revenue growth. That bodes well for competitors such as Motley Fool Global Gains pick ABB
On a more sobering note, GE Capital Finance's earnings fell 58%, and although the lending unit still managed to pull in $1.1 billion in net income, I continue to believe that GE's forecast of $5 billion in earnings from the lending unit is wildly unrealistic.
Are you hearing this, regional banks?
Within this unit, the only segment that lost money was real estate (a loss of $173 million on an asset base of $82 billion); losses and impairments on commercial real estate accounted for the entirety of the loss. That should help check the optimism that bank stock investors have demonstrated over the last six weeks.
In its earnings release yesterday, for example, Bank of America
It will be very interesting to see some of the detail on Wells Fargo's
GE: The long and short of it
Thanks to a surge of optimism concerning the state of the crisis and the health of the global economy, the panic that provoked a run on GE shares appears to have subsided. This gives executive management some breathing room, with greater freedom to focus on running the business instead of reassuring investors. Still, it's not time to relax -- GE must continue to pare its exposure to financing activities.
GE's stock may no longer be a pure speculation, but the company remains a sprawling giant that is difficult to get a good grasp on. That didn't seem to bother investors when GE met analysts' estimates with a regularity that would put a Swiss rail station master to shame, but those days are a victim of the credit crisis.
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Alex Dumortier, CFA, has a beneficial interest in Wells Fargo, but not in any of the other companies mentioned in this article. ABB is a Motley Fool Global Gains recommendation. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has a disclosure policy.