GE Stock Has Been Hot Lately, But the Company is Not
General Electric (NYSE: GE) stock has been on a roller coast ride of ups and downs for a couple of years now, with its latest climb exciting some investors. But be wary as this ride appears to be perched at the top of a hill and ready for another descent.
The stock recently hit a 52-week high of $12.24 a share. This improbable start to 2020 came, oddly enough, after a tumultuous 2019 when the company faced accusations of accounting fraud and uncertainty about its aviation division, one of the last remaining crown jewels at what was once a global empire of finance and technology. Last summer, in response to a research report alleging that the company was hiding $38 billion in losses, the stock tanked to a 52-week low of $7.65 a share in August.
But GE stock ended 2019 as one of the market's stellar performers of the year, rallying 53% in total. At this level, GE stock may be overvalued. Concerns about GE's aviation business caused by the grounding of the Boeing (NYSE: BA) 737 Max as well as over-optimism about assumed revenue growth rates from the defense sector will likely weigh on the share price for months to come. The fundamentals are weak to support General Electric stock as a long-term buy. Here's why.
Source Fool.com
