General Electric To Post Q1 Earnings: Beat In The Cards?

General Electric Company (GE) is scheduled to report first-quarter 2021 results on Apr 27, before market open.

The conglomerate’s earnings surpassed estimates once, lagged twice, and met in one of the trailing four quarters, the average earnings surprise being 44.05%. In the last reported quarter, the company reported earnings of 8 cents per share, which came in line with the Zacks Consensus Estimate.   

In the past three months, shares of General Electric have gained 22.1% compared with the industry’s growth of 12.4%.

Factors at Play

General Electric is likely to have benefited from the growth in its digital business, investments in innovation and actions to lower debts in the first quarter of 2021. Also, impacts of effective cost actions, along with its focus on operational execution, are expected to get reflected in General Electric’s quarterly results. However, the quarter’s performance is expected to have been adversely impacted by the coronavirus outbreak-related issues.

Coming to the operating segments, new product introductions and solid demand for certain products owing to the pandemic are likely to have supported the Healthcare segments’ top-line performance. However, soft demand environment for non-pandemic products and weakness across end markets in India, the United States and Latin America are likely to have affected its revenues.

The Zacks Consensus Estimate for Healthcare revenues stands at $4,168 million, implying a decline of 11.8% from the prior-year reported figure and 13.6% fall sequentially.

For the Aviation segment, lower installation of commercial engines and weakness in the commercial aftermarket business are expected to have hurt its top-line performance. The Zacks Consensus Estimate for the segment’s revenues is pegged at $5,218 million, indicating a 24.3% fall from the year-ago reported figure and 10.8% decline sequentially.

For the Power segment, weakness in service orders is likely to have affected its performance. The Zacks Consensus Estimate for the segment’s revenues is pegged at $3,856 million, suggesting a decline of 4.2% from the year-ago reported figure and 28.4% fall on a sequential basis.

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