General Electric is in the midst of a massive transformation and the clock is ticking.
After more than a decade of stock underperformance, investors and analysts are ready for a turnaround — and the industrial heavyweight continues to promise one.
"We're forecasting 3-5 percent organic growth, 100 basis points improvement. Good backlog, good momentum," said Jeff Immelt, chief executive and chairman of GE, in a recent interview with CNBC's Jim Cramer. "I like the way we're positioned in 2017."
The comment came on the heels of challenging questions about its recently disappointing quarterly performance. Immelt added, "You're going through all the bears."
That may be true. But there are bears and perhaps for good reason.
Right now, GE shares are poised to show a five-week decline. But looking farther back, since Immelt took the helm on Sept. 7, 2001, the stock has dramatically lagged the market. On a price basis, it's down more than 25 percent; factoring in accumulated dividends, the stock's up about 7 percent, according to Kensho. But the Dow Jones industrial average has more than doubled during that time.
To be fair: that period was marked by a number of big financial and geopolitical events, including the 9/11 terrorist attacks (four days after Immelt became CEO) and the financial crisis, which directly impacted GE.
Immelt acknowledged it. He also insisted that it's changing, that shares outperformed both the S&P and the XLI Industrial ETF over the past two years, even the past five (presumably, factoring in dividends). That's because, as he points out, GE is a very different company than the one he inherited — one that no longer gleans more than half its profits from banking.
That corporate makeover means 65 percent of the revenue the CEO inherited from his predecessor Jack Welch was divested.
GE Capital was the biggest of those businesses it shed. The company siphoned off $197 billion worth of assets since announcing its financial services exit plan in April 2015, when Immelt unveiled plans to restructure GE as a pure-play industrial operation with a focus on tech.