SIEGY - Better Buy: GE vs. Siemens
Industrial giants General Electric (NYSE: GE) and Siemens (OTC: SIEGY) are fierce competitors across a number of industries. But despite having exposure to many of the same industries, the two stocks make for very different investments. Here's why.
GE investors are hoping for two things in the next few years. First, and most importantly, the commercial aviation market needs to recover from the devastation brought on by the COVID-19 pandemic, because that market is GE's key earnings and free cash flow, or FCF, generator. That extends to GE Capital as well, as its most important business is an aircraft leasing business , GE Capital Aviation Services.
Second, CEO Larry Culp needs to oversee a margin improvement in the power and renewable-energy segments. Notably, the mid-single-digit margins at Siemens' power and renewables businesses are a target for GE to aim for -- more on that in a moment.
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Better Buy: GE vs. Siemens