General Electric Co.’s stock dropped 2.4% in midday trade Monday, after the manufacturing conglomerate was downgraded at Bernstein, which cited concerns over valuation. Analyst Steven Winoker cut his rating to market perform, after being at outperform since Aug. 5, 2014. Winoker said he considers GE a defensive stock, meaning continued expansion of its premium valuation is unlikely given that the outlook for the economy continues to improve. He said he also sees risks of rising competition in several of GE’s businesses, that growth in its health care segment will be challenged by pricing pressure and believes the success of its power and aviation businesses are already priced in. “For GE, it appears to us tht many sources of upside are now ‘baked into’ the current price and we still have many of the same risks…,” Winoker wrote in a note to clients. Through Friday, the stock had soared 12% in two months to close Friday at the highest level since May 2008.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
From:: Stock Market News