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Non-Tech : General Electric (GE) -- Ignore unavailable to you. Want to Upgrade?

To: CIMA who wrote (1399)	8/30/2000 4:33:51 AM
From: Arthur Tang	Respond to of 3256

Thank you, CIMA. The comment on the market cap of GE and the revenue that GE will have at the end of this year is indeed worthy of discussion. The common British investment principle is in the revenue. They buy revenue. They feel that if they have the revenue, they can borrow money to run the company and derive a profit. In America, the stock market looks at the forward potential of earnings by the multiples of P/E ratio. So, for a growth company, the market cap is way advanced from reality. GE is only an old salt of the earth. Coming back to analyze GE, the market cap is behind the trailing record of accomplishment; it is because Welch never stick his neck out and project the growth of GE. If the specialist ever compares GE against the growth in the economy; and is able to maintain a market of such dizzying height for GE, then we will see some go-go action. As it is, after all these years, the performance of the specialist is trusted. We can safely ride on his coat tail. Many stockholders I am sure worry about some parts of GE faultering. I should know better. The limit of GE is the world economy. Having the 1st, 2nd, and 3rd placed companies in any industry, GE will branch into owning the 4th place companies eventually. While market share will increase, risk will also increase. However, there is no sweat in their matrix management fundamentally to handle less well managed 4th place company in any industry. What GE capital makes, makes GE profitability; not most of their small potatoes. Net(internet) efficiency and productivity will make GE more profitable in the next few years. We will be on the watch and help them succeed. After all we are proactive stockholders.