General Electric (GE) is scheduled to report its first-quarter earnings results on April 30. Analysts expect the company’s EPS to fall YoY (year-over-year) due to various segments’ underperformance.
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Analysts expect General Electric to report an adjusted EPS of $0.09—down ~43% from its EPS of $0.16 in the first quarter of the previous year. The industrial conglomerate’s (XLI) earnings fell more than 20% in the preceding four quarters.
Factors to consider
General Electric’s revenues are expected to fall 5.6% YoY to $27.05 billion in the first quarter. Analysts think that the Renewable Energy and Aviation segments could have strong top-line growth. However, continued weakness in the Power and Lighting segments would weigh on the company’s overall revenue growth.
General Electric’s Power segment has been struggling for the past several quarters. Growing demand for energy-efficient and renewable alternatives has eroded the need for fossil fuel–based power plants. General Electric’s Lighting segment sales were hurt by intensified competition from regional and local players.
Sluggish performances from the Power and Lighting businesses have been weighing on General Electric’s overall revenue and profitability growth. The company’s fourth-quarter earnings fell 37% YoY to $0.17 and missed analysts’ consensus expectation of $0.22 in the period.
Focus on restructuring initiatives
Apart from General Electric’s first-quarter earnings results, analysts and investors will likely focus on the company’s discussion about the ongoing restructuring plan announced in June last year. Over the previous few months, CEO Larry Culp has sped up the planned restructuring initiatives, which helped gain investors’ confidence. So far, the stock has risen ~26% this year.
Most of General Electric’s peers have already reported their first-quarter results. United Technologies (UTX) and Northrop Grumman (NOC) reported a YoY increase of 7.9% and 10.2% in their respective first-quarter earnings. Honeywell International (HON) registered a 1.5% decline in its profits.