AI driven 10Q / 10K text analysis
Since there are always reasons when companies change the wording in their financial filings, being alerted to these changes allows investors to realise potential risk factors and opportunities before they are reflected in the market. Recent alerts include: 1) General Electric - appears to be rethinking defence demand and associated future growth. 2) MSC Industrial Direct - no more geographic expansion? Additional financing required? 3) Range Resources - changing strategy on capital allocation? 4) AutoNation - stabilising new vehicle unit profitability. 5) Blackstone Mortgage Trust - caution on CECL reserves.
Edition: 198
- 01 November, 2024
GE HealthCare Technologies (GEHC)
Healthcare
GEHC boasts an extremely strong competitive position, including its large install base, proven track record of new product introductions, service capabilities, supply chain and regulatory infrastructure, and IP. 50% of GEHC's revenues are recurring, coupled with minimal capital intensity, provides meaningful cash flow visibility. The healthcare industry in which the company operates currently has a TAM of $84bn, a figure projected to increase to $100bn by 2025. Expanding into adjacencies could increase this number by another $50bn in the coming years. The share overhang associated with General Electric’s retained stake in GEHC should soon be alleviated. TP $95 (45% upside).
Edition: 172
- 27 October, 2023
Industrials
The Great Break Up - splitting GE into 3 independent, unconnected companies makes strategic sense and should unlock meaningful value for its shareholders. Based on 2023 estimates, Robert Sassoon’s analysis indicates a SOTP value for GE of ~$152 (50% upside). Despite the extended break-up execution timeline (Healthcare by 2023 and Renewable Energy & Power business by 2024), Robert makes a compelling case for investors to use the current share price lull to jump in and enjoy the catalyst-driven ride.
Edition: 124
- 26 November, 2021