Tomahawk, WI 10/23/2013 (BasicsMedia) – General Electric Company (NYSE:GE) is not satisfied with its status as a global brand with a market cap of more than $260 billion. Not only does GE provide diversified technology services, but it is accomplished at offering financial services as well. Its products are used in households as well as manufacturing plants. GE also produces power generation equipment as well as aircraft engines, and water processing solutions. A number of medical imaging products are produced by GE, thereby, contributing to the company’s revenues and consistent profitability.

GEs Operating Margins Have Improved in Q3 of 2013

GE’s latest financial results indicate that the company’s operating margins had improved substantially, compared to what it reported in the similar period in 2012. The results authenticate my belief that GE is good for long-term investors. If you are an investor with short–term interests, you may fail to appreciate the value of GE. The latest quarterly results indicate that the company continues to enjoy solid order intake. It has a backlog of orders it has not served and once it starts doing this, I expect an increase in its quarterly revenue and operating margins.

GE’s third quarter 2013 revenue may have dropped compared to the levels it attained in the same period in 2012. The revenue that GE raised during this quarter, of $35.72 billion, is a drop of around 1.5% compared to what the company posted last year in the third quarter. Moreover, this was much lower than the consensus estimates of around $36 billion the company was expected to post. GE hopes that these figures will improve going forward through its strategy of making more acquisitions, which will include Lufkin Industries Inc that GE will buy for $3.3 billion.

GE’s Acquisitions Since 2007 Total $11 billion

GE has made close to $11 billion worth of acquisitions since 2007. GE and Lufkin already boast of a solid business relationship lasting close to three decades. Therefore, GE knows what it is getting by investing in Lufkin. The two companies buy different products from each other, and once GE brings Lufkin under its stable, it will reduce its cost of operations, which will have a direct bearing on its revenue, and operating margins going forward. Once GE continues to cut down on its cost of doing business, this will help it maintain regular profits going forward.

Some of the acquisitions GE made are yet to contribute significantly to its total revenues. I think this will change in the near future once GE concludes its restructuring exercise. The acquisitions the company has been making, are putting GE on track to developing into a major powerhouse once more. It is on the way towards getting rid of the reputation it attained in the post-2008 financial crisis where it had to be bailed out by the U.S government. If it continues on this trajectory, GE will grow into a tech giant once again, bearing in mind its diversified investments.

I support GE in its strategy of making new acquisitions that offer a more stable platform and base through which it will earn more revenue and profits.

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