Investors are hoping to get a deeper look into the increasingly mysterious workings of General Electric ( GE) on Thursday as the company hosts its first-ever quarterly conference call. "We expect GE to disclose significant additional information to help shareholders better understand the areas and sources of growth within its business," said Nicholas Heymann, an analyst at Prudential Securities. GE has faced heightened pressure and scrutiny since the collapse of Enron as investors worried that other large and complex companies could be skewing their numbers with questionable accounting. Those fears were exacerbated last month when Pimco fund manager Bill Gross raised concerns about the firm's level of commercial paper and a possible lack of adequate backup lines of credit.
Of GE's units, Power Systems, medical technology and GE Capital are all expected to have contributed positively to earnings, but analysts say they will be listening out for any signs of a turnaround in the short-cycle business. CEO Jeffrey Immelt has said strength in the plastics operations would signal an impending economic recovery. Still, most analysts say they don't expect to hear that the more cyclical businesses are rebounding yet. Questions about the sustainability of earnings growth could also be raised in the call Thursday, particularly since one of the firm's strongest units -- Power Systems -- is expected to slow considerably this year because of a sharp decline in its shipments of domestic gas turbines. In addition, commercial engine aircraft deliveries are seen falling 15% to 20% in 2002, and GE has said it still sees no pickup in advertising at its NBC unit. special-purpose entities ," he said. GE Capital Services expects about $400 million to $500 million in securitization gains in 2002, compared with $800 million in 2001. Friedman will also be looking closely at any rise in accounts receivable and any increase in the issuance of stock option grants, among other things. Shares of GE have fallen 8% so far this year and recently traded for $36.41.