GE Surges as Cash-Flow Forecast Shows Turnaround Gaining Steam

General Electric Co. soared after predicting that cash from its industrial operations would jump this year, signaling renewed progress in Chief Executive Officer Larry Culp’s effort to turn the company around.

Industrial free cash flow will be $2.5 billion to $4.5 billion this year, GE said in an earningsstatement Tuesday. Analysts had been expecting $2.57 billion for the closely watched metric, which investors view as a gauge of the strength of the company’s manufacturing divisions.

The outlook provides a new boost for Culp’s push to restart the repair job he began before the pandemic, when GE was attempting to emerge from an epic corporate collapse. The company generated $4.4 billion in industrial free cash flow in the fourth quarter, smashing expectations for $2.8 billion.

“The fourth quarter marked a strong free cash flow finish to a challenging year, reflecting the results of better operations as well as strong and improving orders in Power and Renewable Energy,” Culp said in the statement.

The shares jumped 7.6% to $11.83 ahead of regular trading in New York. The shares fell 6.1% during the 12 months ending Monday, compared with the 5.5% advance of a Standard & Poor’s index of U.S. industrial companies.

GE also reinstated guidance, forecasting adjusted earnings of 15 cents to 25 cents a share this year.

For more on GE’s earnings, click here for our TOPLive blog.

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