For many investors, it's next to impossible to fully evaluate such a diversified behemoth as General Electric (NYSE: GE). Should you shy away from GE because of its shaky banking business, with lots of exposure to U.S. credit card and subprime-mortgage markets? (I see you shuddering.) And what about GE's sizable portfolio of loans to foreign at-risk countries? Are you bullish on GE's leadership role in helping to rebuild the world's crumbling infrastructure?

In the past quarter, the bears have run over the bulls as investors penalized GE for cutting its dividend by more than half, and for the uncertainty around its plans to reduce its real estate exposure from $80 billion to $40 billion. So is GE now a buy, or are there other companies that provide the diversification of GE but are in a better position to put more money in shareholders' pockets?

We asked our Motley Fool CAPS community to nominate two Industrial Conglomerates peers that are likely to outperform GE.

And the nominees are …
Our 170,000-member CAPS Community views 3M (NYSE: MMM) as a better opportunity among similarly sized companies in Industrials. CAPS member edwjm makes the case that 3M is trading at a discount while providing a healthy dividend:

It is a diversified technology company with a global presence in the following businesses: industrial and transportation; health care; display and graphics; consumer and office; safety, security and protection services; and electro and communications. At the current price of 83.47, the P/E is less than 18, which is good for such a safe company. The dividend is 2 1/2%.

Currently, 3M's price-to-earnings ratio is 15.4, slightly less than GE's at 16.5. Perhaps a better comparison when looking at such diversified businesses, though, is to compare them on how efficiently they manage their capital. For example, let's make a comparison based on return on equity, which measures profit margin, multiplied by its asset turnover, further multiplied by its financial leverage. In short, ROE measures how efficiently the company employs its owners' capital -- your bang per buck as an investor.

Using this metric, 3M sports an ROE of 26.6% versus GE's 9%. 3M knows that it takes more than industry-leading efficiency to spur growth, and that's why it's putting more than $1 billion in research and development. You'll have a lot more work to do to determine whether 3M is a better fit for your portfolio than GE, but this is one good reason to look at 3M as an attractive alternative.

And if you're looking for a small cap that could grow up to become the next industrial-conglomerate superpower, the CAPS community points us toward Seaboard (AMEX: SEB), a diversified international agribusiness and transportation company that is primarily engaged in pork production and processing and ocean transportation. If the CAPS community is right, SEB could provide more attractive returns in the near term than either 3M or GE. CAPS community member akachmar sizes up Seaboard as follows:

Seaboard is a company most people have never heard of, but it's also one all investors should know. The company is very conservatively managed and is engaged in "boring" industries such as food processing and maritime shipping. However, one look at its financials will leave value investors [drooling]. … Patient shareholders will be rewarded with consistent market-beating returns.

Seaboard is trading near its 52-week high, but for a company that generated an eye-popping $187 per share in cash flow over the past 12 months, and that sports a lower P/E (14.2) than either GE or 3M, it may have plenty of room left to run.

Make your vote count!
Do you agree that 3M and Seaboard may be better buys than General Electric? Head over to CAPS, and let the rest of the community know what you think.

John Keeling has no position in any of the stocks mentioned in this article. 3M is a Motley Fool Inside Value choice. The Motley Fool has a disclosure policy.