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General Electric (GE) Gains But Lags Market: What You Should Know

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General Electric (GE - Free Report) closed the most recent trading day at $85.97, moving +0.36% from the previous trading session. This move lagged the S&P 500's daily gain of 3.1%. Elsewhere, the Dow gained 2.18%, while the tech-heavy Nasdaq added 0.21%.

Heading into today, shares of the industrial conglomerate had gained 9.53% over the past month, outpacing the Conglomerates sector's gain of 4.39% and the S&P 500's gain of 1.66% in that time.

Investors will be hoping for strength from General Electric as it approaches its next earnings release. On that day, General Electric is projected to report earnings of $1.12 per share, which would represent year-over-year growth of 21.74%. Meanwhile, our latest consensus estimate is calling for revenue of $21.88 billion, up 7.79% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.54 per share and revenue of $75.86 billion. These totals would mark changes of +19.81% and +2.33%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for General Electric. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. General Electric is currently a Zacks Rank #3 (Hold).

Investors should also note General Electric's current valuation metrics, including its Forward P/E ratio of 33.76. This represents a premium compared to its industry's average Forward P/E of 15.17.

Also, we should mention that GE has a PEG ratio of 4.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GE's industry had an average PEG ratio of 1.85 as of yesterday's close.

The Diversified Operations industry is part of the Conglomerates sector. This industry currently has a Zacks Industry Rank of 90, which puts it in the top 36% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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