NEW YORK (
) -- Speaking at an annual investor meeting on Tuesday,
CEO Jeffrey Immelt told investors that the worst is over for its financing arm.
Throughout 2009, GE Capital has been losing profits, but Immelt says the company has been shrinking the financing arms balance sheet and reducing the highly leveraged parts of its portfolio. The result he says is a smaller, but still meaningful GE Capital. Entering the NBCU joint venture deal with
was also part of GE's plan to take a much more focused approach towards its industrial portfolio, Immelt said.
The laser-sharp focus Immelt wants for GE's core sweet spots in 2010 include high-tech infrastructure and financial services in the emerging markets. He also believes that GE, in particular, is well-positioned to pursue healthcare and IT opportunities in the emerging markets because of its international experience, and that it is currently well-capitalized to pursue those opportunities.
Indeed, GE has been garnering favorable views from credit analysts since it entered its NBCU joint venture agreement with Comcast and began showing progress on improving GE Capital's capital position. Ditto from the equity analysts.
On Thursday, Barclay Capital analysts raised GE's price target to $22 from $20 because of a better 2011 earnings outlook. Barclays also raised its 2009 and 2010 earnings estimates to $1.03 and $0.97, respectively, with an overweight rating.
Meanwhile, leading credit research firm CreditSights on Dec. 3 wrote that Immelt has been meaningfully transforming the company's industrial business portfolio with the NBCU joint venture, and on Wednesday wrote that it maintains its overweight recommendation on GE's credit going into 2010.
During the conference, Immelt cautioned investors that unemployment rates and excess capacities are still high, that the construction and commercial real estate markets are still challenging, and the government stimulus is yet to be felt. Yet he indicated that GE was in a position to compete anywhere in the world heading into 2010.
So what do you think? Is GE ready in a position to conquer the world? Is the worst really over for the company? Take our survey below, and learn the consensus of TheStreet.
-- Written by Andrea Tse in New York
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