General Electric (GE) continues to face struggles, even as the company has been pushed by an activist investor and has seen a high-profile executive turnover in recent times. The debate has long centered around the $2 earnings per share target for 2018, but the reality is that actual earnings lag adjusted earnings by a huge degree and in a structural manner.
As GE has taken on quite a bit of debt as well, and leverage is much higher if pension deficits are taken into account, and past capital allocation moves are highly questionable, shares are no automatic buy on any dips. Despite the simplification efforts, GE remains a very complex business, as I have no desire to buy into this dip given the structural operational underperformance and quite elevated debt load of the business.
