Let's start with General Electric (GE - Get Report), which was particularity hard-hit by Europe and has bemoaned it seemingly forever. CEO Jeff Immelt, perhaps one of the gloomiest souls toward Europe, said many times on his call that Europe has, and I quote, "stabilized." He said for the first time he sees "signs of life" in Europe, notably in the U.K., France and Northern Europe. The health care business, which had become a black hole in Europe, showed the first positive order flow in three years. What was one of the reasons why the stock reacted so positively to the quarter? "We had, obviously, a big improvement in Europe in the orders," across the board.
Honeywell (HON - Get Report) CEO Dave Cote was a tad more circumspect on his call, saying that he is "not ready to declare victory on this one yet." But, he added, "It's been encouraging to see so far." This, from a company big into autos and aerospace and climate controls.
Chuck Bunch, on the other hand, was effusive when he looked at what caused a better-than-expected quarter at PPG Industries (PPG - Get Report) -- namely, a turn in Europe. "We think we've stabilized, and the comparables should get better" from here. When a skeptical analyst questioned this turn call, particularly when it comes to auto coatings, Bunch said that he is hearing the same things in Europe that he had heard at the bottom in the U.S. -- namely, that the auto build would never come back again and would be at permanently low levels. In the U.S., that was when we were building 9 million cars. We will now more likely hit 16 million. Bunch says Europe is just a little far behind us.
Bunch also said he sees "fairly consistent pace of business in the region and a few of our businesses did achieve volume growth in that region this past quarter." Most important, he saw 8% growth in coatings on the continent, a very big increase.Ingersoll-Rand (IR - Get Report) has a gigantic automotive and heating-ventilating and air-conditioning business in Europe, and it attributed much of the strength in the quarter to surprising growth in Europe -- so surprising that it sent the stock to the stratosphere. What happened? Here's a sample comment from the call: "I think we have low expectations for Western Europe, and they're better than what we have thought." The company saw "strength," -- its word, not mine -- in climate controls for the first time in ages on the continent.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV