The great debate continues – that is, is General Electric (GE) finally worthy of your investment dollars? My bullish thesis for this industrial conglomerate has already been well-documented here on Seeking Alpha but, to put it lightly, I have been proven dead wrong over the last 3 years.
GE data byWhere did I get it wrong? Plenty of areas but, to start, I underestimated the impact of the headwinds that the Power division would have to contend with. In addition, the company’s stretched balance sheet turned out to be more than just a question mark, as GE’s credit rating has been downgraded several notches due to the company's worrisome financial position. Lastly, and most importantly, the company's aggressive accounting turned out to be a significant issue (the fraud word has slowly been creeping into the story), which resulted in a SEC investigation and a multi-billion dollar insurance charge.
