Shares of the industrial giant are hovering around a 52-week low as Wall Street questions not only how new CEO John Flannery will lead, but what he could do to accelerate earnings. Perhaps Morgan Stanley put it best last week in a damning new note, predicting a weak second quarter and voicing concerns about the prospects for GE's key power generation business.
TheStreet's founder and Action Alerts PLUS portfolio manager Jim Cramer says struggling GE has been a "huge disappointment" since he bought the stock for his charitable trust, but says investors should give incoming CEO John Flannery a shot at turning things around.
"I like the set-up. I'm not abandoning [the stock]," Cramer said in an exclusive conference call with members of his Action Alerts PLUS club for investors.
Here are three things we know about Flannery.
He Is Open To Change
In June, Flannery promised to deliver results for shareholders while undertaking a comprehensive evaluation of the manufacturing giant's businesses, from locomotives to wind turbines.
The review is "something you'd expect us to do with speed and with urgency and with no constraints," Flannery, the GE Healthcare chief whose promotion to the top job was announced on June 12, told investors on a conference call. "I'll look at each business, I'd say, with a focus on its performance, its growth outlook, the cash, the cost structures, the returns, the competitive environment."
The 55-year-old deflected questions about specific measures he might take as the company grapples with heightened pressure from activist shareholder Trian Partners, whose $1.9 billion stake places it among GE's 20 biggest investors.
On Paper, Flannery's New Roles Haven't Started Yet
Flannery will officially take over as CEO on August 1. He will assume the chairman position effective January 1, 2018.
Flannery will be the 13th CEO in General Electric's storied 125-year old history.
Flannery Is a True GE Lifer
Flannery is a company man, a factor that may have some investors nervous about the changes he is willing to make.
The executive began his career at GE Capital in 1987 where he focused on assessing risk for leveraged buyouts. In the 1990s, Flannery worked in the corporate restructuring department. By 2002, he became the president and CEO of GE Equity.
In the five years before his ascent to the CEO position, Flannery spent time overseas developing teams and then overhauling GE's Healthcare business.
James Langford contributed to this story.
More of What's Trending on TheStreet:
- Chipotle CEO Should Be Canned for Not Apologizing to Sickened Customers in Virginia, Analyst Says
- O.J. Simpson's 4 Biggest Business Achievements
- Best Buy's Geek Squad Is a Mess, According to Customer Reviews, Opening the Door for Amazon's Entry
- Sears' Kenmore Products on Amazon Are Hurting Home Depot, Jim Cramer Explains
- Former Apple Exec: 'It's Sad to See Apple Slipping to the Position of Follower'
- 5 Celebrities Who Have Lost Big in Real Estate Like Golden State Warriors Star Steph Curry