Southern Utah University

Wall Street Journal Article
“GE’s Profit Rises 11% on Solid Equipment Orders”
(Term Paper)

MGMT4200

General Electric is one of the world’s largest companies yet is still able to grow at a 10%- 15% yearly growth rate. How does a company as old and as established as GE continue to Grow at such an impressive rate? An article in the Wall Street Journal Titled “GE’s Profit Rises 11% on Solid Equipment Orders,” Attempts to tell how, by discussing three major topics: GE’s diversification, GE’s company wide financials, and GE’s division financials.

GE’s Diversification General Electric is such a diversified company that its wide range of products and services are needed during any type of economic condition. According to the Wall Street Journal Article, “GE is often considered a barometer for the U.S. economy because of its mix of businesses” GE is involved in Industries from broadcasting and plastics, to medical equipment and financing. GE has been able to find opportunities in many different industries. Therefore they are able to continue growing.

GE’s Company Wide Financials The Chief Executive of GE, Jeffery Immelt says that, “GE remains on track for profit to grow between 10% and 15% in 2005.” In the third quarter of this year GE’s revenue grew 15% from 33.39 billion in 2003 to 38.27 billion in 2004. GE’s price earnings per share increased by 6% this year to 38 cents. General Electric will continue to grow and “get double digit growth,” over the whole next decade, as Bob Millen a co-manger for Jensen Portfolio said.
1.

Divisions of Major Financial Growth Though the financial growth of GE as a whole looks very good, some of GE’s businesses did better than others. GE’s Commercial finance division is now GE’s biggest business. It “increased net income by 18% to 1.24 billion. GE’s Consumer