S&P 500   4,109.31
DOW   33,274.15
QQQ   320.93
MarketBeat Week in Review – 3/27 - 3/31
The Market Crash Shield is A.I. (Ad)pixel
UK travelers face hours-long waits for ferries to France
Intensity and insults rise as lawmakers debate debt ceiling
Unusual Passive Income Investment (Found on a Golf Course) (Ad)
Credit Suisse takeover hits heart of Swiss banking, identity
UN body mulls deep sea mining amid demand for minerals
This Tech Stock Could be the Next Amazon (Ad)pixel
Small areas reopen near Fukushima nuclear plant, few return
UN food chief: Billions needed to avert unrest, starvation
S&P 500   4,109.31
DOW   33,274.15
QQQ   320.93
MarketBeat Week in Review – 3/27 - 3/31
The Market Crash Shield is A.I. (Ad)pixel
UK travelers face hours-long waits for ferries to France
Intensity and insults rise as lawmakers debate debt ceiling
Unusual Passive Income Investment (Found on a Golf Course) (Ad)
Credit Suisse takeover hits heart of Swiss banking, identity
UN body mulls deep sea mining amid demand for minerals
This Tech Stock Could be the Next Amazon (Ad)pixel
Small areas reopen near Fukushima nuclear plant, few return
UN food chief: Billions needed to avert unrest, starvation
S&P 500   4,109.31
DOW   33,274.15
QQQ   320.93
MarketBeat Week in Review – 3/27 - 3/31
The Market Crash Shield is A.I. (Ad)pixel
UK travelers face hours-long waits for ferries to France
Intensity and insults rise as lawmakers debate debt ceiling
Unusual Passive Income Investment (Found on a Golf Course) (Ad)
Credit Suisse takeover hits heart of Swiss banking, identity
UN body mulls deep sea mining amid demand for minerals
This Tech Stock Could be the Next Amazon (Ad)pixel
Small areas reopen near Fukushima nuclear plant, few return
UN food chief: Billions needed to avert unrest, starvation
S&P 500   4,109.31
DOW   33,274.15
QQQ   320.93
MarketBeat Week in Review – 3/27 - 3/31
The Market Crash Shield is A.I. (Ad)pixel
UK travelers face hours-long waits for ferries to France
Intensity and insults rise as lawmakers debate debt ceiling
Unusual Passive Income Investment (Found on a Golf Course) (Ad)
Credit Suisse takeover hits heart of Swiss banking, identity
UN body mulls deep sea mining amid demand for minerals
This Tech Stock Could be the Next Amazon (Ad)pixel
Small areas reopen near Fukushima nuclear plant, few return
UN food chief: Billions needed to avert unrest, starvation

GE HealthCare Technologies Soars As GE Legacy Business Plummets

Key Points

  • GE HealthCare Technologies began trading Wednesday, ending the session 12% higher.
  • The company has a market cap north of $27 billion and is part of the medical device industry.
  • It expects organic revenue growth in the mid-single digits. It also expects acquisitions to boost growth. 
  • General Electric will split its renewable power business unit into a separate company next year. 
  • 5 stocks we like better than GE HealthCare Technologies

GE HealthCare Technologies Soars As GE Legacy Business Plummets

Wednesday marked the trading debut of GE HealthCare Technologies Inc. (NASDAQ: GEHC), the health-focused independent business spun off from General Electric Company (NYSE: GE)

Shares opened at $54.13 Wednesday and ended the session at $60.49, an increase of nearly 12%. 

Meanwhile, legacy company GE, which will now focus on the existing aviation business, gapped down nearly 18%. 

GE said last summer that it would split into three companies to unlock shareholder value via separate businesses. GE has a long history as a conglomerate and, in 2018, was the last of the original stocks to be dropped from the Dow Jones Industrial Average. 

GE HealthCare Technologies Soars As GE Legacy Business Plummets

Shares have been mired in mediocrity in recent years, notching the following returns:

  • 1 year: -11.37%
  • 3 years: -3.54%
  • 5 years: -9.02%
  • 10 years: -2.92%
  • 15 years: -4.21%

Investors holding onto those shares for the long haul incurred quite an opportunity cost, although a rally between 2009 and 2016 would have yielded a solid return.

The GE ticker will be applied to a business called GE Aerospace. Current CEO Larry Culp will head up that company. This business can license the GE name to other companies and products, including those ubiquitous light bulbs manufactured by another company but marketed using the GE name. 


Starting Out With $18 Billion In Sales

The new entity, GE HealthCare Technologies, begins life with about $18 billion in yearly revenue, a presence in more than 160 countries, and about 51,000 employees around the globe. The company said about half of that revenue came from recurring sources, which is always a good sign. It means the sales team isn’t starting from scratch every month or year. 

The company has four business units: Imaging, Ultrasound, Patient Care Solutions, and Pharmaceutical Diagnostics.

According to the company’s news release when it began trading Wednesday, GE HealthCare Technologies “expects its addressable markets will expand from $84 billion in 2021 to $102 billion by 2025. That expansion provides significant opportunities for growth and execution of the Company’s precision care strategy to safely and securely integrate patient data from imaging, lab, pathology, genomics, and other sources.”

It further noted that precision care layers those data with artificial intelligence using the company’s Edison platform and digital apps. This strategy develops information to help clinicians diagnose diseases and determine the best treatments.

Factors including Covid-19 and people living longer with chronic diseases have increased the need for image scans, and GE HealthCare hopes to address some of that demand. At an investor day last month, Jan Makela, president, and CEO of GE HealthCare’s Imaging business, said the company’s products could scan in half the time of a conventional process while also improving image quality. 

Sales Growth In Mid-Single Digits 

At the same event, GE HealthCare CEO Peter Arduini said the new company had targeted medium-term organic sales growth in the mid-single digits. The company is also evaluating acquisitions to grow revenue. One example was its 2022 acquisition of ultrasound device manufacturer BK Medical. 

GE shareholders retain nearly 20% of the outstanding shares of GE HealthCare's common stock.

The spinoff represents a blow for GE shareholders, though. The healthcare segment accounted for about 25% of GE’s revenue in 2021.

GE HealthCare, headquartered in Chicago, has a market capitalization of nearly $27 billion. That means it could eventually qualify for inclusion in the S&P 500. 

It will be tracked within the medical devices industry, which is home to fellow large caps such as Intuitive Surgical Inc. (NASDAQ: ISRG) and 

IDEXX Laboratories Inc. (NASDAQ: IDXX). Both are components of the S&P 500. GE HealthCare’s market cap puts it instantly as the third-largest company in its industry group. 

The third company to be spun off will comprise GE’s Power and Renewable Energy business units, known as GE Vernova. Culp said GE expects to complete that spinoff in early 2024.

Should you invest $1,000 in GE HealthCare Technologies right now?

Before you consider GE HealthCare Technologies, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and GE HealthCare Technologies wasn't on the list.

While GE HealthCare Technologies currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here


Elon Musk's Next Move

Wondering when you'll finally be able to invest in SpaceX, StarLink or The Boring Company? Click the link below to learn when Elon Musk will let these companies finally IPO.

Get This Free Report
Elon Musk's Next Move Cover

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
GE HealthCare Technologies (GEHC)
1.0213 of 5 stars
$82.03-0.1%N/AN/AModerate Buy$90.00
General Electric (GE)
2.1881 of 5 stars
$95.60+1.6%0.33%-3,186.67Moderate Buy$93.14
Intuitive Surgical (ISRG)
2.6099 of 5 stars
$255.47+1.7%N/A69.80Moderate Buy$270.39
IDEXX Laboratories (IDXX)
2.2913 of 5 stars
$500.08+1.3%N/A62.28Moderate Buy$520.63
Compare These Stocks  Add These Stocks to My Watchlist 

Kate Stalter

About Kate Stalter

Contributing Author: Retirement, Asset Allocation, and Tax Strategies

Kate Stalter is a Series 65-licensed asset manager, with more than two decades of experience in various areas of financial services. As an investment advisor and financial planner, Kate personally manages client portfolios, with a focus on successful retirement, including asset allocation, income generation and tax strategies. Kate also serves as a capital-markets contributor at Forbes.com, and is an expert columnist for the investment advisory channel at U.S. News & World Report.
Contact Kate Stalter via email at stalterkate@gmail.com.

Featured Articles and Offers

Search Headlines: