General Electric (NYSE: GE) reported first-quarter earnings Friday that outpaced Wall Street expectations and reaffirmed its financial outlook for the year.
Earnings per Share came in at 16 cents vs. 11 cents expected by analysts surveyed by Thomson Reuters. Revenue was $26.87 billion vs. $27.45 billion expected by analysts.
The embattled industrial conglomerate – founded by Thomas Edison -- saw its shares drop to the lowest level since July 2009 as Wall Street and the media alike questioned the risks lurking within GE Capital's portfolio. The stock has slid 21% since January, when GE first announced a review of its GE Capital insurance portfolio.
Then came the Securities and Exchange Commission investigation into GE's accounting practices and the U.S. Justice Department investigation in connection with sub-prime mortgages.
"These outstanding legal matters or investigations amount to up to $10 billion in incremental liability in GE Capital," Bank of America said in a note April 12, while noting that it sees this total charge as "the worst case scenario."
The industrial conglomerate is also looking at spinoffs for some of its subsidiaries, such as its GE Transportation business. Such spinoffs have "historically created outsized value," Melius Research said in a note last month.
CEO John Flannery has begun to make good on his promise in October that the company would sell $20 billion in assets, with GE most recently announcing plans for private-equity firm Veritas Capital to acquire a GE health-care unit for $1.05 billion in cash.
GE shares began Friday up 85 cents, or 6%, to $14.84
