General Electric Drops Into Ranking as Dow's Worst-Performing Stock

Industrials

Published: June 9, 2018 8:24 am

Last Updated: January 11, 2020 10:34 pm

General Electric Co. (NYSE: GE) shares lost about 1.2% last week and established the company as the worst performer among the Dow equities for the year to date.So far in 2018 the shares have lost a fraction over 20.2%.

The second-worst Dow stock so far this year is The Procter & Gamble Co. (NYSE: PG), down 16%; followed by Walmart Inc. (NYSE: WMT), down 14.6%; 3M Company (NYSE: MMM), down 12.3%; and Johnson & Johnson (NYSE: JNJ), down 11.2%. The 30 Dow stocks are evenly split with year-to-date winners and losers each numbering 15.

The Dow dropped almost 118 points over the course of the last week to close at 24,635.21, down about 0.5%. For the year to date the consumer staples sector has dropped about 13.5%, worst among the 10 market sectors.

The Dow added more than 680 points over the course of the past week to close at 25,316.53, up nearly 2.8%. For the year to date the consumer staples sector has dropped about 11.5%, worst among the 10 market sectors.

The big news from GE this week was a Friday announcement that the company would pay its $0.48 per share dividend for the second quarter. At Friday’s closing price the dividend is producing a yield of 3.48% to shareholders, enough to overcome the many issues the company faces.

Activist investor Nelson Peltz said last week than when GE CEO John Flannery says that “everything is on the table” then investors should take him seriously. The remark was widely interpreted to mean that Peltz believes a breakup of GE is possible. Peltz’s Trian Fund Management firm has a seat on GE’s board.

Finally, GE said Friday that two of its business units are jointly starting a company called AiRXOS to provide management and control services for drones. By itself the startup is unlikely to turn GE’s fortunes around, but it does indicate some signs of life.

GE stock closed at $13.93 on Friday, up nearly 1.1% for the day in a 52-week range of $12.73 to $29.47. The 12-month consensus price target on the stock is $17.50 and the forward price-earnings ratio is 13.27.

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