General Electric (GE) To Post Q3 Earnings: What To Expect?

General Electric Company (NYSE:GE) is scheduled to report third-quarter 2019 results on Oct 30, 2019, before the market opens.

The company’s financial performance in the last four quarters was mixed, having recorded better-than-expected results twice and lagging estimates on the other two occasions. The average earnings surprise was positive 14.59%. In the last reported quarter, its earnings of 17 cents surpassed the Zacks Consensus Estimate of 12 cents by 41.67%.

In the past three months, the industrial conglomerate’s shares have dipped 13.3% compared with the industry’s decline of 3.5%.

Let us see how things are shaping up for General Electric this quarter.

Factors Influencing GE’s Performance

General Electric’s debt reduction efforts, digital business, solid international presence and restructuring efforts are expected to have positively impacted third-quarter 2019 performance. Also, solid liquidity position and initiatives to lower exposure to the GE Capital business are expected to be reflected in third-quarter results.

However, persistent weakness in the Power segment, poor margin profile of Renewable Energy and unfavorable movements in foreign currencies might have played spoilsport in the third quarter.

The Zack Consensus Estimate for the company’s earnings per share is pegged at 12 cents, indicating a decline of 14.3% from the year-ago quarter’s reported figure. Also, the consensus estimate for revenues of $29,143 million suggests a 1.5% fall from the year-ago quarter’s reported figure.

The Aviation segment is likely to have benefited from the rising popularity of LEAP engines, strengthening of services and the military businesses, and rise in passenger air travel globally. The Power segment is likely to have benefited from the company’s restructuring efforts despite facing challenges.

For the third quarter of 2019, the Zacks Consensus Estimate for the Power segment’s revenues is pegged at $4,167 million, suggesting declines of 11% and 27.4% from the previous quarter and the year-ago quarter’s reported figures, respectively.

It is worth noting here that the Zacks Consensus Estimate for the Industrial segment’s (comprising Power, Aviation, Renewable Energy, GE Capital, Oil & Gas, and Healthcare) revenues in the to-be-reported quarter is currently pegged at $24,107 million, suggesting a 10.9% decline from the previous quarter and a 13.2% decrease from the year-ago quarter’s reported figures. Profits for the Industrial segment are likely to be $2,489 million, suggesting rise of 5.5% from the previous quarter’s reported figure and 7.1% from the year-ago quarter’s number.

Earnings Whispers

Our proven model doesn’t conclusively predict an earnings beat for General Electric this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The company has an Earnings ESP of -13.79%, as the Most Accurate Estimate of 10 cents is below the Zacks Consensus Estimate of 12 cents.

General Electric Company Price, Consensus and EPS Surprise

Zacks Rank: General Electric currently carries a Zacks Rank #3.

Stocks That Warrant a Look

Here are some companies that you may want to consider as according to our model, these have the right combination of elements to post an earnings beat this quarter:

Plug Power, Inc (NASDAQ:PLUG) presently has an Earnings ESP of +58.33% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Sealed Air Corporation (NYSE:SEE) currently has an Earnings ESP of +2.40% and a Zacks Rank #3.

Welbeit, Inc (NYSE:WBT) has an Earnings ESP of +1.01% and a Zacks Rank #3 at present.

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