The following is an excerpt from Ben Levisohn | October 23, 2017 | Barrons.com |
On Friday, shares of General Electric (GE) battled back from an early 6% drop to finish up 1.1% on the day after releasing earnings. GE's sharers are getting hit again today, but this time it doesn't look like they'll rally back.
On Friday, the theme after GE's earnings was that the worst was over, a theme that was picked up today when BofA Merrill Lynch analyst Andrew Obin upgraded its stock to Buy from Neutral this morning. "Our analysis indicates that earnings revisions have been the key driver for GE stock over the past decade," Obin wrote, according to CNBC. "We assume that negative revisions are bottoming as EPS guide has been properly reset on a multi-year basis going into the 11/13 analyst meeting."
But two analysts downgraded the stock this morning. UBS analyst Christopher Belfiorecut cut GE to Neutral from Buy, and cut his dividend target by 30%. Morgan Stanley's Nigel Coe and team, meanwhile, cut General Electric to Under Weight from Equal Weight, despite the fact that they call CEO John Flannery "the right man for the mission." They explain why:
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