Where Will General Electric Be in 3 Years?
In a sense, the headline to this story is a question that already has an answer -- there won't be a General Electric (NYSE: GE) in three years. Instead, by mid-2025, the current company will have broken up and become three companies. First, GE HealthCare will be spun off in early 2023. Next, GE's energy businesses (GE Power, GE Renewable Energy, GE Energy Financial, and GE Digital) will be combined and spun off as GE Vernova. Finally, the remaining business will be renamed GE Aerospace.
So that much is already known. It's the critical question, "what kind of shape will all three businesses be in after a few years?" that investors should really be asking right now.
It's a good idea to look at all three companies separately because the performance of each one has direct relevance to the others. That's because GE's debt will be distributed across each business, and the amount is likely to vary in relation to how much each business generates in earnings. This is because investors and rating agencies measure net debt in terms of an earnings metric like earnings before interest, depreciation, and amortization (EBITDA).
Source Fool.com
