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GE to Offer HA Gas Turbine Technology to Fortress in Ohio

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General Electric Company’s (GE - Free Report) Power segment recently secured orders for its state-of-the-art HA — the largest and most efficient fleet of gas turbines in the world. Notably, the company entered into a deal with Fortress Transportation and Infrastructure Investors LLC (FTAI - Free Report) to provide its industry-leading 7HA.02 gas turbine technology for the latter’s Long Ridge Energy Generation LLC Project, based in Hannibal, OH.

Inside Story

Per the deal, General Electric will be responsible for offering its advanced 7HA.02 gas turbine technology at the 485-MW power plant project. In addition to the heavy-duty gas turbine, GE will supply one heat recovery generator and one GE steam turbine and generator. The deal also involves a multi-year services agreement between both the companies.

GE’s advanced HA gas turbine technology will bring greater flexibility and efficiency to the plant’s operations required for producing efficient and low-cost energy in Ohio. Notably, the plant’s construction is likely to be completed by November 2021, and it will cater to the requirements of reliable electricity for industrial customers, apart from creating new job opportunities.

Existing Business Scenario

General Electric intends to become more competent by focusing on core businesses. In this regard, the company intends to strengthen its Power business, which dented its performance over the past few quarters. It is looking to resolve the external and internal challenges through better inventory and material management, product development and delivery, as well as billings and collections.

Currently, the company has been focusing on a disciplined financial strategy to reduce leverage at both its industrial businesses as well as GE Capital. It is worth noting here that the company substantially completed $20 billion of asset sales planned for GE Industrial in 2018.

The Zacks Rank #3 (Hold) company’s share price has increased 29.9% in the past three months compared with 13.5% growth recorded by the industry.

However, General Electric’s Renewable Energy segment is suffering from unfavorable pricing conditions, delay in execution of projects and headwinds related to the Alstom joint venture. In addition, its Transportation segment is witnessing unfavorable mix of services and products. These issues might continue impacting General Electric performance in the quarters ahead.

Stocks to Consider

A couple of better-ranked stocks from the same space are Carlisle Companies Incorporated (CSL - Free Report) and United Technologies Corporation (UTX - Free Report) . While Carlisle sports a Zacks Rank #1 (Strong Buy), United Technologies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Carlisle pulled off average positive earnings surprise of 14.46% in the trailing four quarters.

United Technologies delivered average earnings surprise of 14.87% in the trailing four quarters.

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