Is It Time to Buy General Electric Stock?
It's understandable that value investors are taking a long hard look at General Electric (NYSE: GE) stock right now. The stock is down around 34% on a year-to-date basis, and despite the headwinds in the global economy, GE still has world-leading businesses in its portfolio.
But is it enough to make the stock a buy? Let's take a closer look.
It's a good idea to break out General Electric's segments in order to see just where the profitability lies. Equally important is ascertaining where the potential for a swing in profits and free cash flow (FCF) comes from. For reference, GE's current market cap is $65 billion, so based on a price-to-FCF multiple of 20 times, GE needs at least $3.25 billion in FCF to start looking like a good value.
Source Fool.com
