I just found out that (GE) fell below $20 today. To be blunt, I'm not too surprised. While this is pretty rare, I actually agree with the analysts. Here's just a quick snapshot of what they are saying:
- Weak revenue and low profits
- Challenging growth environment
- Falling demand, excess inventory and higher costs
- Class action lawsuits
- Spare plane shenanigans
Despite the price being under $20 today I'm still not buying. That's because I am waiting for clarity on the dividend cut, which I think can be rather positive for investors as I've already explained.
I won't buy GE until two things happen. First, as I've said, I want clarity on the dividend but especially why the dividend is being cut and how the saved cash will be used. This is critical because it tells me how the executives think. If I'm not in alignment and agreement then I simply won't invest. Second, GE needs to fall below $17 before I'll get really interested, and I won't buy until it's below $16.
