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General Electric (GE) Healthcare Spin-Off Set for January '23

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General Electric (GE - Free Report) is on track to spin-off its healthcare business into a new public company in early 2023. In this regard, GE announced a new board for the independent GE HealthCare company.

Some of the board of directors include Peter J. Arduini, president and CEO of GE’s healthcare business and H. Lawrence Culp, Jr., chairman and CEO of GE. The board will also include top management executives from some major healthcare operators.

Subject to final approval from the GE board of directors and other customary conditions, the tax-free spin-off is expected to be completed in the first week of January 2023. In this connection, GE HealthCare will host an investor day on Dec 8, 2022.

In November 2021, General Electric announced plans to split its business into three independent companies — comprising GE Healthcare, GE Aviation (to be renamed GE Aerospace) and the combined operations of GE Digital, Renewable Energy and GE Power (to be named GE Vernova).

The spin-off of GE Digital, Renewable Energy and GE Power businesses is expected to be completed in early 2024. Following the completion of these transactions, GE plans to operate as an aviation-focused company. GE’s separation into three public companies is expected to help each business to flourish through better operational focus, capital allocation policies and financial flexibility.

The Healthcare segment is benefiting from Imaging, Ultrasound and HTS services sales and strong order demand. Revenues from the segment increased 1% year over year in the first half of 2022. Continued recovery in the commercial market is driving growth of the Aerospace segment (revenues up 19% year over year in the first half of 2022).

However, the Power and Renewable Energy segments are experiencing weaknesses. Lower orders due to softness in shipment volumes are hurting revenues at the Power segment. The segment’s revenues declined 6% year over year in the first half of 2022. Lower U.S. onshore volumes and continued pressure from onshore North American market are weighing on orders in the Renewable Energy segment. Revenues in the segment fell 18% in the first half of 2022.

Zacks Rank & Key Picks

General Electric presently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks within the Conglomerates sector are as follows:

Carlisle Companies (CSL - Free Report) currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for CSL’s 2022 earnings has been revised upward by 14.7% in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks.

Carlisle has an estimated earnings growth rate of 114.4% for the current year. Shares of CSL have rallied 27% in the past six months.

Icahn Enterprises (IEP - Free Report) presently carries a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for IEP’s 2022 earnings has been revised upward by more than 100% in the past 60 days.

Icahn Enterprises has an estimated earnings growth rate of 144.4% for the current year. Shares of IEP have gained 5% in the past six months.


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General Electric Company (GE) - free report >>

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Carlisle Companies Incorporated (CSL) - free report >>

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