Thursday, September 25, 2008

GE (GE) Cuts Guidance, Its Credibility Destroyed

From 24/7 Wall Street:
GE (GE) was one of the last men standing in corporate America. The company said the credit issues facing the economy would not damage GE Financial. The conglomerate indicated that it could make its way through the downturn.

No one lied, but a lot of people at GE must have miscalculated.

GE only offered one piece of good news as it cuts its guidance for the rest of the year. It will maintain its dividend. On the less positive side of the ledger, it will cut its share buyback.

GE Financial did turn out to be the rough spot at the company. The announcement about earnings said "GE now expects that its businesses will earn approximately $2 billion in the third quarter, which, while impacted by current market conditions, is expected to exceed the earnings of any financial services company." That is remarkably poor PR work. It masks bad news with a thin coat of crap....MORE

Where's the P.R. guy from this story: "GE gets grant to install GE solar panels on GE headquarters"?:
The PR flack was quoted as saying:

“It’s a good demonstration project for the technology,” O’Toole said.

Asked why a large, profitable corporation like GE would need financial help from the state, O’Toole said one reason “is to show you have to invest in new technologies. Companies cannot do it alone.”

In other GE news, spokesmen did comment on whether PR spin could be harnessed as an inexhaustible and eternal source of power....