Deep Dive on GE: Consolidated Enterprise Valuation

In my view, the most appropriate way to look at GE’s stock valuation is to consider the company as a single enterprise.  In this analysis, I compare its current valuation to peers.  My calculations for GE’S enterprise value-to-EBITDA multiple at 31-Dec-19 and 30-Mar-20 are given in the table below:   

Continue reading
Posted in GE, Industrials | Tagged | Leave a comment

Deep Dive on GE: Projected 2020 Consolidated Results

Based upon management’s guidance given at General Electric’s 2020 Outlook meeting on March 4th, I project 2020 Industrial Leverage EBITDA of $11.6 billion, up roughly 3% from 2019.  Industrial Leverage EBITDA was given in the appendix to the company’s 2020 Outlook presentation slides and was meant to be used in the calculation of GE Industrial’s ratio of EBITDA-to-net debt.  The measure excludes non-operating pension benefit costs, which is the part of total pension costs that cover all items that relate primarily to the funding of GE’s pension plans, excluding the service cost.

Continue reading
Posted in GE, Industrials | Tagged | Leave a comment

Deep Dive on GE: The 2020 Outlook for its Businesses

Given the complexity of its business mix and financial structure, valuing GE is not an easy exercise even under benign economic conditions.  The task is made even more difficult when there is considerable uncertainty about prospects for the global economy.

Continue reading
Posted in GE, Industrials | Tagged | Leave a comment

Though It Might Be Delayed, GE’s BioPharma Sale is Set to Close

GE’s stock has been battered during this sell-off, falling much more than the broader market as a whole.  Since reaching an intra-day peak of $13.26 on February 12 (roughly one month ago), the stock has fallen 40.8% to its March 13 close of $7.85.  By comparison, the S&P 500 has fallen 19.8% over that same time frame.

Continue reading
Posted in GE, Industrials | Tagged , , , | Leave a comment

Recent Observations on Bed Bath & Beyond

The investor optimism that followed the October 2019 appointment of Mark J. Tritton as Bed Bath & Beyond’s CEO and continued after the company gave a preliminary upbeat assessment of its performance early in the Christmas selling season gave way to disappointment initially when it withdrew fiscal 2019 guidance in January and especially following the company’s update on its fiscal fourth quarter performance on Feb. 8.  Since reaching a peak of $17.79 on Dec. 18, the stock has fallen $8.30 or 52% to $9.49 on March 5.  Most of that decline occurred right after the fourth quarter update announcement. Most recently, the stock has been caught in the coronavirus market sell-off.

Continue reading
Posted in BBBY, Consumer Discretionary, Consumer Staples | Tagged , | Leave a comment

Brightcove’s “Disappointing” Quarter

On Thursday (2/21), Brightcove (BCOV) reported somewhat disappointing 2019 fourth quarter performance and guidance which caused its stock to plummet 12.8% on the open and end the day down 7.2% (from the previous close). Yet, buyers emerged quickly after the stock got slammed at the open.  The stock closed up 6.5% on the day from the opening low.

Continue reading
Posted in BCOV | Tagged | Leave a comment

A Strong Start for Housing

2019 was a solid year for U.S. housing.  While still subject to modest revisions, government figures show that new residential sales increased 10.4% from an estimated 617,000 units in 2018 to 681,000 units in 2019.  Single-family housing starts advanced 1.4% to an estimated 888,200 units in 2019 from 875,700 units in 2018.

Continue reading
Posted in Consumer Discretionary, Housing | Tagged , | Leave a comment

A Brief Update on StoneMor

StoneMor Partners, L.P. has passed a few milestones since my previous update in late September.  These accomplishments have advanced its turnaround, but more is needed including a significant rebound in its profitability before the effort can be declared a success.

Continue reading
Posted in Consumer Staples, STON | Tagged | Leave a comment

NJR Adjusts to Meet Its Challenges and Opportunities

Under new CEO Steve Westhoven, the business portfolio of New Jersey Resources (NJR) has evolved as it typically does in response to changes in its operating environment.  Its regulated utility operations, New Jersey Natural Gas (NJNG) and its Midstream segment, are increasing their contribution to NJR’s total earnings through expanded investment.  NJNG is benefiting from continued infrastructure investment and modest customer growth.  The Midstream segment is growing through acquisitions, including the pending acquisitions of Leaf River Energy Center and the Adelphia Gateway.  Growth in the regulated operations is replacing expected declining profits from New Jersey Clean Energy Ventures, which is anticipating a decline in state and federal tax benefits for renewable energy projects.

Continue reading
Posted in NJR, Utilities | Tagged | Leave a comment

Brightcove’s Prospects Look Brighter

A key change at Brightcove since my last post has been the turnover at the top.  In August 2017, after three consecutive quarters of earnings misses, Dave Mendels, who had served as CEO for more than four years, agreed with the Board to step down.  Andrew Feinberg, Brightcove’s COO, stepped in as interim CEO.

Continue reading
Posted in BCOV, Technology | Tagged | Leave a comment