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Will Aviation and Renewable Energy Benefit GE in Q4 Earnings?

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General Electric Company (GE - Free Report) is scheduled to report fourth-quarter 2019 results on Jan 29, 2020, before the market opens.

The GE Aviation segment mainly manufactures commercial jet engines and components, and provides aftermarket services. It accounted for 37.9% of Industrial revenues in the third quarter of 2019.

Alternatively, the Renewable Energy segment provides offshore wind turbines, high-voltage equipment, blades for wind turbines (onshore and offshore), and other products and services. The segment accounted for 20.7% of Industrial revenues in the third quarter.

Apart from Aviation and Renewable Energy segments, the Industrial segment’s results include that of Power and Healthcare segments.

Key Factors to Note

The Aviation segment’s performance in the past few quarters has been strengthening General Electric’s revenues. It has been gaining primarily from the increased popularity of LEAP engine as well as strengthening services businesses. Also, rise in passenger air travel globally and improving military businesses are anticipated to have aided the segment in the quarter.

For the fourth quarter of 2019, the Zacks Consensus Estimate for Aviation’s revenues is pegged at $9,018 million, suggesting 6.6% rise from the year-ago quarter’s reported number and 11.2% growth from the previous quarter’s figure.

Efforts to offer new products, cost-saving actions and solid orders are likely to have aided Renewable Energy’s fourth-quarter performance. Also, business in the onshore wind market is expected to have flourished during the quarter, while that in the grid market is likely to have remained challenging.

For the fourth quarter of 2019, the Zacks Consensus Estimate for Renewable Energy’s revenues is pegged at $5,348 million, suggesting growth of 59.1% from the year-ago quarter’s reported number and a 20.9% increase from the previous quarter’s figure.

Industrial’s Q4 Expectations

The Zacks Consensus Estimate for Industrial’s fourth-quarter revenues is currently pegged at $24,443 million, suggesting 14.3% growth from the previous quarter’s reported figure and a 23.2% decrease from the year-ago quarter’s number. Profits for the Industrial segment are likely to be $3,397 million, indicating 38.7% rise from the previous quarter’s reported figure and 29.8% growth from the year-ago quarter’s number. (Read more: General Electric to Post Q4 Earnings: What to Expect?)

Zacks Rank & Other Upcoming Releases

General Electric currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some stocks in the industry, which are also slated to report their results soon, are Honeywell International Inc. (HON - Free Report) , Carlisle Companies Incorporated (CSL - Free Report) and Emerson Electric Co. (EMR - Free Report) . Honeywell will release results on Jan 31, Carlisle on Feb 6 and Emerson on Feb 4.

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