When General Electric Company was added to the Own Every Stock Portfolio a couple years ago, the financial markets were a much different environment than the investment landscape today.  Back then, General Electric was considered a good barometer of the overall market because the large conglomerate's business was thought to be diversified across many different sectors of the economy.  To some extent, that premise was true, but what wasn't factored in, was how one arm of the business (GE Capital) could severely damage and bring down the overall profits and stability of the company as a whole.  In fact, the losses from the GE Capital arm aren't expected to stabilize and reverse course until 2011.  In addition, the losses from the financing arm were so detrimental to General Electric that earlier this year the company was forced to forgo its annual dividend increase and instead cut its dividend by nearly 70% down to $.10 per quarter from $.31 per quarter.

However, GE has begun to change its focus from a large conglomerate back to its core industrial strengths.  For example, GE recently announced it is selling 51% of its stake in NBC to Comcast for an estimated 30 billion dollar overall transaction.  I wouldn't expect the company to divest too much of its assets, but I do expect the growth to come from its core businesses.  A good example is the 14 billion dollar wind generation project in Oregon, GE was just awarded.  General Electric will remain a big conglomerate, but I expect its major revenue and earnings drivers to be from its industrial businesses.

From a technical standpoint, GE's stock has bounced off its bottom channel while trending up from its March low of around $6 to its current level of around $16.  However, the channel has been narrowing suggesting a breakout move in one direction.  Up the upside, I would look for a confirmed breakthrough of the 17.50 to 18.00 range.  18.45 is the current 52 week high and the stock hit some strong resistance in September when it tested the 17.00 to 17.50 range before receding to the $14 support level and bouncing up to its current levels.  For the past month, GE has been oscillating around the $16 level in a consolidating fashion similar to the overall market.  I expect more consolidation to occur before a test and breakthrough of either resistance or support.  Personally, I would wait for confirmation of direction before making a shorter term trade in either direction.  Over the long term, I expect General Electric to continue growing its core business eventually improving revenue, earnings, and its stock price.

Disclaimer:  My opinions should not be viewed as a recommendation to buy or sell General Electric and is intended only for informational purposes.  Please conduct your own due diligence before making any investment decision.