Why did GE just spike at from 14:56?

Why is this stock going up so much. The news was not that much of a big deal. This was known already?

Is it mainly delta hedging prior to expiration?

 

It was the dividend boost:

http://dealbook.blogs.nytimes.com/2...-g-e-may-raise-dividend/?partner=yahoofinance

Companies in trouble don't raise dividends.

 

But thats not new news. They already hinted at it on the annual report stuff for 09 which was a few weeks ago.

 

good looking chart

 

True. But things have changed since then. Thats why GS hosted the conference.

 

By Rachel Layne

March 16 (Bloomberg) -- General Electric Co., which last year cut its dividend for the first time since the Great Depression, may resume increases in 2011 amid a “snapback” at the finance unit, Chief Financial Officer Keith Sherin said.

“We’d like to grow the dividend in 2011,” Sherin told investors today at a conference in Boston organized by Goldman Sachs Group Inc. The outlook for the remainder of 2010 has become clearer since the company discussed fourth-quarter results in January, he said. “We’ve got better visibility around financial services. If you think about 2011, we believe we’re going to have GE earnings growth.”

GE Chief Executive Officer Jeffrey Immelt has refocused the Fairfield, Connecticut-based company on its role as the world’s biggest provider of jet engines, medical-imaging equipment and power turbines, targeting emerging-market and service-contract growth as well as research and development.

Last year, the company invested 7 percent more in research and plans to keep developing new products while shedding divisions not central to its main business lines, such as a majority stake in the NBC Universal media unit, Sherin said.

He repeated a forecast for about $25 billion in cash at the end of this year and said the company may also use the proceeds for strategic acquisitions as the GE Capital division contributes from 30 percent to 40 percent of total profit.

“On the industrial side, we’ve made a clear call on capital allocation to invest back into infrastructure,” Sherin said. “We feel great about the growth.”

Dividend Cut

GE cut its annual dividend to 40 cents from $1.24 in February 2009, the first such reduction since 1938, as the global recession and credit crunch drained profit at its finance unit. In March of the same year, Standard & Poor’s Ratings Services cut the company’s credit ratings to AA+ from AAA, the highest available. Moody’s Investors Service followed the same month with a reduction to Aa2 from Aaa, its highest.

GE’s earnings from continuing operations fell 38 percent to $11.2 billion in 2009, and per-share profit from continuing operations of $1.03 is expected to remain about the same in 2010, the company repeated, with growth in 2011 and 2012. Analysts have estimated GE will post adjusted profit of $10.6 billion this year and $12.9 billion in 2011.

“With the company expected to earn roughly $23 billion over the next two years, and substantial improvement to the leverage ratio at GE Capital, and vastly improved capital market conditions, it seems totally appropriate for GE to re-evaluate its dividend payout ratio,” said Joel Levington, who follows GE for Brookfield Investment Management Inc. in New York. Levington said he expects a “measured” approach from the company.

Shares Climb

GE rose 78 cents, or 4.5 percent, to $18.07, at 4:15 p.m. in New York Stock Exchange composite trading, the highest closing price since Nov. 5, 2008.

GE has raised reserves to cover delinquencies and losses inside GE Capital, while the division has remained profitable overall.

“Clearly, the losses are going to peak for us sometime at 2010,” Sherin said. “As we go forward, we’re not going to have those loss levels, which, without even any new strategies in GE Capital, you’re going to get a real earnings snapback.”

Stephen Tusa, an analyst with JPMorgan Chase & Co., told investors in a note today that he concurred with GE’s assessment that losses inside the finance arm would peak in 2010. For the previous year, the company posted a $175 billion equipment and service backlog in its large-equipment divisions, which Tusa said are stable and “slowly turning.”

‘Pieces in Place’

“For the first time in over 10 years, the pieces are in place for earnings upside, a key to moving GE from value to momentum,” wrote Tusa, who has an “outperform” rating on the stock.

Under financial reform proposals introduced yesterday by U.S. Senator Christopher Dodd, a Connecticut Democrat, GE expects to be regulated by the Federal Reserve, doesn’t see a forced breakup of the parent company and the finance unit and should be able to keep its industrial loan and thrift banks based in Utah, Sherin said.

“It would be good to get financial regulatory reform completed,” Sherin said, adding the company’s goal is to be “well-capitalized in any scenario.”

To contact the reporter on this story: Rachel Layne in Boston at rlayne@bloomberg.net

 

I bet goldman Sachs was loading up on those penny 17.5 calls

 

I agree. They always get their share of action.

 

Why is GE up again?

 

Because it wants to go back to $12.