GE Update for Physicians and Investors


Hi David,

I hope this note finds you well. Here at GE, September was an important month for us. We concluded our annual strategy reviews with each business, complementing the quarterly operating reviews with a longer-term focus. I had the opportunity to participate in many of the review processes and came away impressed with our progress, leadership team, and the growth opportunities that lie ahead as we innovate for the future of flight, precision health, and energy transition.

In my last investor update, I shared the exciting news that GE announced an agreement to acquire BK Medical, and in the spirit of growth and innovation, I’d like to share a few more recent business highlights that illustrate how our teams are delivering for our customers:

  • At Aviation, Bamboo Airways signed a Memorandum of Understanding agreement to purchase GEnx engines for its Boeing 787-9 aircraft. This order of 10 firm and 20 options, valued at a list price of approximately $2 billion, will help the airline expand its transcontinental flight network. Dang Tat Thang, CEO of Bamboo Airways, said, “The selection of the GEnx engines for our Boeing 787-9 aircraft will help increase the operational efficiency and service quality of Bamboo Airways on Vietnam-U.S. nonstop flights as well as many potential international routes.”
  • Renewable Energy announced today that it received an order to supply Haliade-X turbines for Massachusetts’s Vineyard Wind 1, the first utility-scale offshore wind installation in the U.S. Additionally, our Haliade-X offshore wind prototype turbine recently became the first in the industry to operate at 14 MW, increasing our customers’ ability to produce more power from a single turbine.
  • Gas Power announced the delivery, installation, and commissioning of four TM2500 aeroderivative gas turbines in only 42 days to supplement renewable power generation for the State of California’s Department of Water Resources during peak demand season. GE’s TM2500s start and ramp up quickly in just minutes and will help enhance the reliability and sustainability of California’s grid.

See the source image

We’re excited about what the future holds, as our teams are highly focused on executing for our customers, leveraging lean to drive meaningful progress and innovating for a more sustainable world.

We look forward to sharing more on our 3Q’21 earnings call on Tuesday, October 26. As always, I welcome your feedback.



Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™



PODCAST: General Electric Healthcare!





Thank You


A General Electric Healthcare [Physician] Investor Update

Enabling precision health PODCAST

Hi David, and all ME-P Readers and Subscribers

We’re proud to be a part of improving patient lives globally with precision health – personalizing diagnoses and treatments in a smarter and more efficient way.

In case you missed it, last week GE Healthcare’s Pharmaceutical Diagnostics business (PDx) announced the acquisition of Zionexa, a leading innovator of in-vivo oncology and neurology biomarkers that help enable more personalized healthcare.

Healthcare will scale Zionexa’s FDA-approved PET imaging agent Cerianna, which is used as an adjunct to biopsy for the detection of estrogen receptor (ER) positive lesions to help inform treatment selection for patients with recurrent or metastatic breast cancer.

This is the essence of precision health, and our continued commitment to innovation. Read more about Zionexa here.

And, as a reminder, Carolina will be participating in a fireside chat on May 12 at 12:10pm EDT during the Goldman Sachs Industrials & Materials Conference. We hope you and all interested ME-P readers and subscribers will tune in.

GE Healthcare logo

Steve Winoker

[GE Corporate]

Boston, MA

Why I have no opinion on GE shares – today

On General Electric

By Vitaliy Katsenelson CFA

A lot of times I won’t have an insight into a business because I don’t understand it or because it’s too complex. GE is a great example today. I’m a value investor; I should be all over this stock that is making a generational low. Not at all. I looked at GE a half a dozen times over the years, and every single time I walked away without understanding the business or what it is worth.


To make things worse, despite GE’s being one of the most-admired companies in the US, I have always hated its culture. Jack Welch went into the corporate history books as the best American CEO ever. I’d argue that this history needs some serious rewriting. Welch built a company with a “beat this quarter” culture. Jack’s GE was not in the business of building moats and investing for the long run; he was in the business of beating quarters. In his book, Welch raved that from the early 2000s GE always beat Wall Street estimates. He was proud of how managers of one division were able to “come up with” a few more cents of earnings if another division fell short of its forecast. I kid you not – reread that sentence, three times. If I was at the SEC I’d investigating GE’s accounting.

GE played games with their earnings for a long time, but the reality that its cash flows couldn’t cover its dividend, which was supposedly half of its earnings, is what triggered a wake-up call for investors. GE is another reminder that it is incredibly dangerous to own a stock just because you like the dividend. Consistency of recurrence of dividend payments creates an optical illusion that the dividend will always will be there. Just think about it: GE’s dividend of 96 cents was half of what the company was expected to earn and it still couldn’t afford to pay it.

Polar opposite CEOs

I’d argue that Welch is on the opposite end of the spectrum from Jeff Bezos. Bezos doesn’t even know how to spell quarterly earnings. In one of his interviews Bezos explained that Amazon makes decision years out. So the current quarter’s report reflects decisions Amazon made several years ago. I don’t want to own companies that are run by the likes of Welch, but we own a few that are run by the likes of Bezos. When I hear management praise their ability to beat last quarter’s earnings, I run.

GE was ultimately destroyed by enormous capital misallocation. They assumed anything they touched with Six Sigma, independent of the price they paid, would turn to gold. So they didn’t care how much they paid for acquisitions. (I’ll discuss the topic “death by acquisition” next week in part two of this article.)

There is another lesson for me here. We always look for simplicity and transparency. If a company’s business is complex and opaque, we move on. One of the most important things in investing is what you do in between buying or selling a stock. After you buy it is just a matter of time before your initial assumptions come under fire. Maintaining rationality throughout your ownership of the company is paramount, and to do that you need to understand the business well. Thus (at least for us) the business cannot be opaque or overly complex. (We set an upper limit to the IQ required of us to understand the business.)


So, that’s why I have no opinion on GE shares today.


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