Insightful analysis and commentary for the US and global equity investor
Contributors: Douglas McIntyre Jon C. Ogg

Previous Posts

Tuesday, October 24, 2006

The Short Sellers Come For GE

Short interest in October for General Electric rose to 52.2 million shares. That was up from the September number of 39.2 million. Maybe Wall St. doesn’t think laying off people at NBC will solve GE’s problems. And, they may be right.

GE appears to be a company run by brilliant people who can’t get the stock price up. That means that the market believes that the geniuses at GE aren’t fixing the company. Almost any school child can tell you that GE’s stock is actually below where it was five years ago, which means that it has been thrashed by the performance of the S&P. Putting money in a mattress might bring a better result.

While the management at GE tries to exorcise the ghost of Jack Welch, Wall St. keeps trying to figure out why the company keeps underperformers like NBC Universal and the slow growing industrial unit that has GE’s consumer and plastics businesses.

It would appear that no amount of evidence or pleading by investors will convince the GE board and management that it is in one or two too many businesses. That leaves no reason for anyone to believe that the stock will do any better.

Douglas A. McIntyre can be reached at He does not own securities at companies that he writes about.

Powered by Blogger