When it comes to the earnings reports from General Electric Co. (NYSE: GE), they still can perhaps best be described as “complicated and complex.” In fact, it may still be some time before investors and analysts can all see eye to eye here due to the complexities inside of GE. Investors have many reasons to feel suspect about GE’s earnings, but the long-term opportunists also have feathers in their caps.

On top of looking at earnings and some of the initial investment commentary from market pundits, 24/7 Wall St. wanted to do a look at both sides of the coin. Again, the bulls and the bears alike both have plenty of points here.

Going into earnings, GE’s consensus analyst price target was $33.09. At the start of this year, GE’s 2016 bullish and bearish case showed a consensus analyst price target that was lower than now, at $31.77, implying a total return of only about 4.9% at the time, if you include the dividend yield.

As far as the first quarter of 2016, General Electric did actually beat the consensus earnings per share (EPS) expectation ($0.21 vs. $0.19 expected). Revenue of $27.85 billion was ever so slightly ahead of the $27.62 billion expected. In the same period a year ago, GE reported EPS of $0.20 on revenues of $26.24 billion.

The bulls will be happy that GE reaffirmed its 2016 earnings outlook of $1.45 to $1.55 EPS. Yet, the bears can focus on GE’s organic orders being down 7% in the first quarter. Organic revenue growth in 2016 is expected to be in the range of 2% to 4%.

As far as why things are so complicated here, GE has been changing itself massively from within. It is more than just a basic reorganization. Turning the ship on a company with a market value north of $280 billion is no simple feat and cannot be accomplished in a very short period. GE’s recent history has been to value the company as a mix between a financial giant and an industrial conglomerate. GE’s efforts are taking it to where it is 25% or less tied to financial activities, in an effort to be valued as an industrial conglomerate for a higher market multiple. This effort has been fruitful so far, but it is a very long process.

Restructurings also make it very hard for analysts and investors to be very accurate in how to make projections. GE has completed the Synchrony Financial spin-off and share swap. GE has sold off billions of dollars worth of its financial assets in multiple transactions, and now GE has been in the process of getting rid of its status as a Systemically Important Financial Institution (SIFI). And to make matters even tougher for everyone to forecast ahead, GE’s last year also involved getting rid of its Appliances unit and getting its Alstom acquisition deal closed in Europe.

Again, there are many moving parts. Then you even have to throw in the billions and billions of dollars that GE is using now and is planning to use for massive share repurchases in an effort to shrink its share count, originally from about 10 billion shares down closer to about 8 billion, after it spends somewhere in the vicinity of $40 billion to $50 billion on those buybacks.
Stifel maintained a positive stance so far, saying that power turbine performance was weaker than expected along with locomotive and energy efforts. Still, Stifel sees GE as a preferred defensive stock that is great to buy on any pullbacks.

Bank of America Merrill Lynch maintained its Buy rating and $33 price objective. The firm noted that GE operationally exceeded lowered expectations, with a robust aviation trend and weak power results.

S&P reiterated its Buy rating and its $38 price target for 12 months out. S&P’s estimate is based on 21.6 times its 2017 EPS estimate of $1.76, and while it is above peer estimates, the firm thinks GE’s ongoing transformation will accelerate profits and cash flows to justify a premium.

Credit Suisse maintained its Outperform rating and $34 price target in its flash note. The company had some caution about organic orders, but industrial margins were above expectations, with Alstom adding about an expected $0.05 to the EPS in 2016 alone.

If you move past what GE’s analysts are saying, the company’s guidance seems unchanged ahead. GE noted an 18% rise in its backlog of orders to $316 billion. GE Capital sent the parent a $7.5 billion dividend in the first quarter and is on track for close to $18 billion in 2016. GE also spent some $6.1 billion buying back stock in the first quarter alone, leaving billions more to be spent on buybacks in 2016 and 2017.

Operating profit in GE’s industrial segments fell 7% to $3.3 billion. GE’s deal for Alstom acquisition contributed a net loss of $0.01 per share in the quarter, but GE sees Alstom adding $0.05 in EPS for the year. Revenues in the oil and gas segment were down 18% year over year to $3.31 billion, while energy connections revenue rose 34% to $2.26 billion and renewable energy popped 62% to $1.67 billion. GE has signed deals to sell $166 billion worth of assets inside of GE Capital.

GE’s stock price was down 1.6% at $30.48 late Friday morning. Its 52-week trading range is $19.37 to $32.05 and the market cap is close to $284 billion. GE’s stock had barely been above the flatline for 2016 coming into earnings, and the lower price had its stock down about 1% so far in 2016 after the report.

Again, this is a story where the bulls have many reasons to cheer and the bears have their side of the story too. GE has been one of the 24/7 Wall St. list of 10 stocks to own for the decade, and Friday’s earnings and outlook report will not change that status.

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