General Electric Co. (NYSE: GE) has by far been the best conglomerate of 2015. 24/7 Wall St. just ran a comparable analysis on all the large conglomerates to see which one would be the best opportunity in conglomerates for 2016. And while its views were very preliminary, Argus is looking for a solid 2016 for General Electric.

Wednesday’s analyst upgrades and downgrades showed that Argus has reiterated its Buy rating in GE shares. What stood out here is that GE’s price target at the firm was raised to $36 from $34 in the call. GE closed at $30.49, so if you include its dividend yield, this would imply more than 20% in upside in 2016.

It should be noted that Argus now has among the highest analyst price targets on Wall Street. Just recently the highest target was $35. Thomson Reuters now shows the highest analyst target being $38, but the consensus analyst price target is still only $31.77.

Argus noted that the GE’s 2016 outlook and updated 2015 guidance was a positive. CEO Jeff Immelt and team now see mid-teens earnings per share (EPS) growth based on 2% to 4% organic revenue growth in 2016. Immelt said that he again expects “slow growth” and a “volatile world” to take place in 2016. GE set its 2016 earnings guidance at $1.45 to $1.55 per share, which was up 11% to 19% from the Argus 2015 estimate.

Argus sees leadership in GE coming from integrating the Alstom power and grid businesses (adding five cents in 2016 EPS and $0.20 EPS in 2018), renewable energy and in health care operations. Oil and gas and transportation are expected to be laggards, and foreign currency is expected to have a negative impact of $0.02 per share next year. Argus said:

We expect a pick-up in EPS next year based on current restructuring efforts, the Alstom acquisition, and share buybacks. Our 2015 EPS forecast is $1.30 and our 2016 (EPS) forecast is $1.55. Now that the restructuring of GE Capital is essentially complete, the company plans to apply to regulators to deregister as a Systemically Important Financial Institution. Assuming the filing is approved, management will likely take out additional debt to buy back stock.

Argus also points out GE’s strong new order trends. The growing backlog of booked business was a positive, as was the continued divesting of GE Capital. Argus said:

The plan to divest most of GE Capital will now place additional focus on the Industrial businesses, and management expects to invest $10 billion to $15 billion annually in industrial growth initiatives. We see the higher margin backlog, solid execution in the industrial businesses, and a smaller GE Capital that provides financing for the company’s industrial customers, as strong positives for General Electric, and believe that GE stock remains attractively priced based on a range of valuation metrics.

Argus does acknowledge the disappointment in the failed sale of GE Appliances for $3.3 billion to Electrolux. The company said that the 2015 Industrial operating earnings will come in at the low end of its forecast range of $1.13 to $1.20 in EPS. Still, GE Capital’s retained verticals are expected to add $0.15 in EPS.

Another boost is expected to be a massive share buyback and strong dividend in 2016. The GE board has authorized the repurchase of up to $50 billion in common stock, and it is expected to cut its share count to 8.5 billion or less by 2018. GE has indicated that it plans to maintain its dividend at the current level in 2016 and grow it thereafter.

On the valuation front, Argus thinks that GE shares are attractively valued at the current price (near $30). While this is at the high-end of a 52-week and multiyear range, GE’s stock chart is in a bullish pattern of higher highs and higher lows that dates back to August 2015. GE is valued at 19.3 times projected 2016 earnings. While that is above the midpoint of the five-year range, it is actually in line with the peer average.

On a price-to-sales basis, GE’s shares are now trading below the peer group average, according to the Argus analysis. GE’s dividend yield of about 3.0% is also above the midpoint of its five-year range and remains above the average dividend for peers.

GE shares were last seen trading up 0.5% at $30.64 on Wednesday. Even on Friday’s pop, the Argus price target of $36.00 implies 17.5% upside, and then the 3.0% dividend yield takes the implied total return over 20%.

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