GE‘s stock has fallen even further since the end of November and is now trading at less than $7 per share. Culp is still “the new guy,” but the market isn’t giving him any grace period to learn the ropes.
And even if the company does manage to execute its asset sale and debt reduction plans quickly and effectively — neither a guarantee — GE will still have a long and tough road back to growth and hardly any dividend with which to reward investors for their patience.
GE’s shares have been on an ever-worsening downward trend since January 2017, when its stock was trading at about $32 per share. Since then, the stock has lost more than 75% of its value, closing out November 2018 at just $7.50 per share. Ouch!
With no dividend left to speak of and concerns mounting about GE’s debt and valuation, institutional and retail investors began to exit the stock. Culp admitted as much on Nov. 12 in an interview on CNBC. “When we announced on our earnings conference call that we were taking our dividend down to 4 cents a year, we didn’t do anything positive for our retail shareholder base and they have been exiting the stock, I think, as a result,” he said.