Can GE Bring Good Things to Its Business Once Again?


PenneyVanderbilt

Wharton University
It would have been considered a turbulent stretch for any company, but the recent fall of General Electric has struck many as especially unsettling. The venerable multinational firm is experiencing a cash crunch, has seen the evaporation of more than $100 billion in market value over the past year, and recently cut its dividend for only the second time since the Great Depression. “Downright staggering,” is how one analyst quoted in a December Barron’s article described GE’s stock decline of more than 40% in a year when its Dow Jones brethren added 25% in value.

The article’s headline asked the question on the mind of many: “General Electric: Where’s the bottom?”

Poor timing has something to do with GE’s troubles, says Wharton emeritus management professor Marshall W. Meyer, noting its move into energy as the sector has slumped. But GE’s woes also beg a larger question, he says…

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