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General Electric (GE) Announces Debt-Restructuring Actions

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General Electric Company (GE - Free Report) , on May 6, announced some of its debt-restructuring actions to further strengthen its financial condition. Notably, it is executing tender offers and considering debt issuance to meet this end.

Inside the Headlines

As noted, the company commenced tender offers for several notes previously issued by it and its subsidiaries, including General Electric Capital Corporation, GE Capital European Funding Unlimited Company and GE Capital UK Funding Unlimited Company.

Notably, the tender offers is applicable for 4.625% notes due 2021, 5.300% notes due 2021, floating-rate notes due 2021, 4.650% notes due 2021, 4.350% notes due 2021, 0.800% notes due 2022, 3.150% notes due 2022 and 5.980% notes due 2022. In addition, tender offers can be applied to 3.100% notes due 2023, 2.625% notes due 2023, two of the floating-rate notes due 2023, 5.125% notes due 2023 and 4.125% notes due 2023.

Total principal amount outstanding is $1,214 million for 4.625% notes due 2021, $1,167 million for 5.300% notes due 2021, €1,000 million for floating-rate notes due 2021, $1,506 million for 4.650% notes due 2021, €550 for 4.350% notes due 2021, €1,000 million for 0.800% notes due 2022, $1,086 million for 3.150% notes due 2022 and €100 million for 5.980% notes due 2022. Further, total principal amount outstanding is $1,318 million for 3.100% notes due 2023, €1,000 million for 2.625% notes due 2023, $915 million for two of the floating-rate notes due 2023, £175 million for 5.125% notes due 2023 and £550 million for 4.125% notes due 2023.

The tender offers will expire on May 14, while May 19, 2020, has been expected as the settlement date. Notes validly tendered will be purchased by General Electric (or its units/subsidiaries), and hence will be retired and canceled.

In addition, the company’s business segment, GE Capital, is considering private debt offerings across four U.S. dollar-denominated tranches, followed by a euro-denominated offering.

It is worth noting here that GE Capital’s external debts have been reduced by $10 billion so far in 2020. General Electric targets GE Capital’s debt-to-equity to be less than 4x over the long term.

Zacks Rank, Price Performance and Estimate Trend

The company, with a $52.3-billion market capitalization, currently carries a Zacks Rank #3 (Hold).

Over the past six months, its share price has decreased 48.1% compared with the industry’s decline of 20%.

 


 

In the past 30 days, the Zacks Consensus Estimate for the company’s earnings has declined by 69.8% to 13 cents for 2020.

Stocks to Consider

Some better-ranked stocks are Intellicheck, Inc. (IDN - Free Report) , Lakeland Industries Inc. (LAKE - Free Report) and Berry Global Group, Inc. (BERY - Free Report) . All the companies currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Intellicheck delivered a positive earnings surprise of 70.24%, on average, in the trailing four quarters.

Lakeland delivered a positive earnings surprise of 475.0%, on average, in the trailing four quarters.

Berry Global delivered a positive earnings surprise of 6.63%, on average, in the trailing four quarters.

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