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General Electric (GE) to Post Q1 Earnings: Beat in the Cards?

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General Electric Company (GE - Free Report) is scheduled to report first-quarter 2021 results on Apr 27, before market open.

The conglomerate’s earnings surpassed estimates once, lagged twice, and met in one of the trailing four quarters, the average earnings surprise being 44.05%. In the last reported quarter, the company reported earnings of 8 cents per share, which came in line with the Zacks Consensus Estimate.   

In the past three months, shares of General Electric have gained 22.1% compared with the industry’s growth of 12.4%.

Factors at Play

General Electric is likely to have benefited from the growth in its digital business, investments in innovation and actions to lower debts in the first quarter of 2021. Also, impacts of effective cost actions, along with its focus on operational execution, are expected to get reflected in General Electric’s quarterly results. However, the quarter’s performance is expected to have been adversely impacted by the coronavirus outbreak-related issues.

Coming to the operating segments, new product introductions and solid demand for certain products owing to the pandemic are likely to have supported the Healthcare segments’ top-line performance. However, soft demand environment for non-pandemic products and weakness across end markets in India, the United States and Latin America are likely to have affected its revenues.

The Zacks Consensus Estimate for Healthcare revenues stands at $4,168 million, implying a decline of 11.8% from the prior-year reported figure and 13.6% fall sequentially.

For the Aviation segment, lower installation of commercial engines and weakness in the commercial aftermarket business are expected to have hurt its top-line performance. The Zacks Consensus Estimate for the segment’s revenues is pegged at $5,218 million, indicating a 24.3% fall from the year-ago reported figure and 10.8% decline sequentially.

For the Power segment, weakness in service orders is likely to have affected its performance. The Zacks Consensus Estimate for the segment’s revenues is pegged at $3,856 million, suggesting a decline of 4.2% from the year-ago reported figure and 28.4% fall on a sequential basis.

Aside from the Healthcare, Aviation and Power segments, revenue estimates for the company’s Renewable Energy segment stand at $3,170 million for the first quarter, suggesting a 0.8% decrease from the year-ago quarter’s reported number and a fall of 28.6% from the previous quarter’s reported figure.

The Zacks Consensus Estimate for the Industrial segment’s (comprising Power, Aviation, Renewable Energy and Healthcare) revenues for the first quarter is pegged at $16,412 million, suggesting a 20.9% decline year over year and a 25.2% decrease sequentially.

The Zack Consensus Estimate for General Electric’s earnings for the first quarter is pegged at 2 cents, suggesting decline of 60% and 75% from the year-ago reported number and the prior-quarter reported figure, respectively. The consensus estimate for revenues of $17,576 million suggests a 14.4% decline year over year and a 19.8% decrease sequentially.

Earnings Whispers

Our proven model predicts an earnings beat for General Electric this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

This is the case here as given below:

Earnings ESP: The company has an Earnings ESP of +33.33%.

General Electric Company Price and EPS Surprise

General Electric Company Price and EPS Surprise

General Electric Company price-eps-surprise | General Electric Company Quote

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

Other Key Picks

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

Deere & Company (DE - Free Report) has an Earnings ESP of +1.13% and it currently sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Colfax Corporation (CFX - Free Report) has an Earnings ESP of +0.68% and a Zacks Rank #3.

ITT Inc. (ITT - Free Report) has an Earnings ESP of +3.73% and Zacks Rank #3.

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