How Will GE (GE) Stock Respond to $3.5 Billion Aircraft Engine Investment?

NEW YORK (TheStreet) -- General Electric Co. (GE)  plans to invest $3.5 billion in the aircraft engine business over the five years through 2017, double the previous period, to boost production of civilian aircraft engines, the Nikkei reports.

GE plans to open a new engine assembly plant in Lafayette, IN, bringing it into full operation by 2016. It also intends to invest $48.2 million in Alabama for facilities to build such items as nozzles, a core component.

The company expects to increase annual output to 3,300 engines in 2020 from 2,600 in 2013, the Nikkei said.

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 GE-made aircraft engines in civilian use are projected at 44,000 in 2020, a 30% gain from 2013.

Shares of GE are slightly lower in pre-market trade.

TheStreet Ratings team rates GENERAL ELECTRIC CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate GENERAL ELECTRIC CO (GE) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

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