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By George Bocchetti, Philip Song, and Sundeep Kutumbaka

Yay GE…Shay PC. By George Bocchetti, Philip Song, and Sundeep Kutumbaka. General Electric. Our recommendation: BUY limit at 16.00. General Electric: Background. GE has technology, media, and financial services

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By George Bocchetti, Philip Song, and Sundeep Kutumbaka

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  1. Yay GE…Shay PC By George Bocchetti, Philip Song, and Sundeep Kutumbaka

  2. General Electric • Our recommendation: BUY limit at 16.00

  3. General Electric: Background • GE has technology, media, and financial services • GE started in 1876 by Thomas Edison, who founded the Edison General Electric Company • Through various mergers that became General Electric as we know it today • GE is listed in the Dow Jones • It is the world’s third largest company as of September 30, 2008(Market cap) • Headquarters in Fairfield, Connecticut

  4. General Electric: What They Do • From household appliances to power plants, General Electric is plugged in to businesses that have shaped the modern world. • The company produces: • Transportation equipment for aircrafts, automobiles, and locomotives. • kitchen and laundry appliances. • Lighting, electric distribution and control equipment, including generators and turbines. • Medical imaging equipment. • GE is also one of the main financial service companies in the U.S., with business in commercial finance, consumer finance, and energy financial services. http://finance.aol.com/company/general-electric-company/ge/nys/company-description

  5. General Electric: Basic Numbers • Current Price: $17.55 • P/E Ratio: 8.36 • F P/E Ratio: 15.16 • Beta: 1.01 • Dividend: $0.31 • Dividend Yield: 7.07% • EPS: 2.10 • 52-Week Low: $12.58 • 52-Week High: $38.52 • Market Cap: $184.20B   • Institutional Ownership: 54% Stats as of 12/04/08

  6. General Electric: 3 Months

  7. General Electric: 6 Months

  8. GE VS. S&P500: 3 Months

  9. GE VS. S&P500: 6 Months

  10. General Electric: Potential • Revenue of 2007 was $172, 738 million • Profit was $72,807 million • Target Price: $23.00 • November 13, 2008: CEO and Vice Chairman bought $1,570,744.44 worth of GE shares, or 100,000 shares • October 1, 2008: Directors bought 5867 shares

  11. General Electric: Recent News • Currently just submitted bids for hydroelectric power projects along with Plutonic Power of Canada • November 26, 2008: GE Money India cut costs and restructured business model to adapt to financial state • November 20, 2008: Began work with Transformational Medical Technologies Initiative (TMTI) to make virtual human that will help drug design(Contract awarded by Department of Defense) • November 19, 2008: Installed plant at South Africa Sasol facility • October 1, 2008: Buffett invested $3 billion in GE

  12. Panasonic • Our recommendation: SELL SHORT limit at $12.00

  13. Panasonic: Background • Panasonic manufactures electronic devices and appliances in an array of business areas • Founded in 1918; its first product was a duplex lamp socket. It then began producing devices such as bicycle lamps, electric irons, and motors. • After WWII it supplied Japan with bicycles and radios • The founder’s brother started Sanyo as a supplier to Panasonic, Sanyo is now a competitor • Headquarters: Kadoma, Japan

  14. Panasonic: What They Do • PC is engaged in the production and sales of electronic and electric products. • Panasonic offers a multitude of different products for business, industrial, and consumer use. • Most products bear the Panasonic brand name. Some regional brand names include: • “National” for household electronics sold in Japan • “Technics” for high-fidelity systems

  15. Panasonic: What They Do (Cont’d) • The Company’s segments comprise audiovisual connection networks, home appliances, components and devices, Matsushita Electric Works, Ltd. (MEW) and PanaHome Corporation. • In August 2007, Victor Company of Japan Ltd. (JVC) and its consolidated subsidiaries became associated companies from Matsushita’s consolidated subsidiaries.

  16. Panasonic: Basic Numbers • Current Price: $11.06 • P/E Ratio: 7.14 • F P/E Ratio: Unpredicted • Beta: 0.97 • Dividend: $0.23 • Dividend Yield: 4.26% • EPS: 1.55 • 52-Week Low: $11.29   • 52-Week High: $24.38   • Market Cap: $22.90B     • Institutional Ownership: 6% Stats as of 12/04/08

  17. Panasonic: 3 Months

  18. Panasonic: 6 Months

  19. PC vs. S&P500: 3 Months

  20. PC vs. S&P500: 6 Months

  21. Panasonic: Potential • Downgraded to sell on November 27th. • Net profit forecast for this year is down 40%. • Net profit forecast for 2009 slashed by 90%. • Rival Sanyo Electric Corporation gaining leverage over most of its sales. • Panasonic is trying to get a stake in Sanyo but is competing with Goldman Sachs. • Sales of Panasonic televisions expected to drop 10% more by the end of this year.

  22. Panasonic: Recent News • http://www.newsoxy.com/panasonic/article11400.html - Nov 30. Director of Panasonic Slashes 2009 profit forecast by 90%. • http://www.bloomberg.com/apps/news?pid=20601101&sid=ahOa0QumDikk&refer=japan – Dec 1. Panasonic trying to get a stake in Sanyo but is competing with Goldman Sachs. • http://www.techradar.com/news/world-of-tech/panasonic-slashes-profit-forecasts-489143?src=rss&attr=all – Nov 27. Panasonic “revises” this year’s profit forecast by 40%. • http://www.bloomberg.com/apps/news?pid=20601101&refer=japan&sid=aUJDpdwOJrz0 – Nov 28. Japan’s recession deepens; weaker demand for Panasonic flat screen TVs.

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