2024-05-09 14:29:53 ET
Summary
- General Electric completed its spinoff of GE Vernova, the final part of its plan to split into three separate entities.
- The spinoff simplifies the business structure and adds clarity to the growth and valuation of each entity for shareholders.
- I expect healthy long-term growth for GE Aerospace, although not as high as the 13% CAGR implied by the market consensus.
- However, the current high P/E ratio (41x+) already prices in much of this growth.
GE stock completed Vernova spinoff
General Electric ( GE ) recently completed its GE Vernova spinoff. In early April, holders of GE common stock received one share of GE Vernova common stock for every four shares held as of March 19. GE Vernova, which is the gas power and renewable energy business of the previous parent company, will now trade under the ticker GEV on the New York Stock Exchange. This move completes General Electric’s plan to split into three separate entities, which was originally announced back in 2021. What's left under the GE ticker now is the aerospace operations of the portfolio. After the spinoff, this remaining entity will rebrand to GE Aerospace....
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General Electric: GE Vernova Spinoff Adds Growth Clarity, But Stock Fairly Priced