Stock Analysis on Net
Stock Analysis on Net
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General Electric Co. (NYSE:GE)

Analysis of Investments

Advanced level

Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities

General Electric Co., adjustment to net earnings (loss) attributable to the Company

US$ in millions

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12 months ended: Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net earnings (loss) attributable to the Company (as reported) 5,704  (4,979) (22,355) (5,786) 8,831 
Add: Investment securities (1) 100  64  (775) 203 
Net earnings (loss) attributable to the Company (adjusted) 5,703  (4,879) (22,291) (6,561) 9,034 

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).


Adjusted Profitability Ratios: Mark to Market Available-for-sale Securities (Summary)

General Electric Co., adjusted profitability ratios

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Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
Net Profit Margin
Reported net profit margin 7.81% -5.69% -19.69% -5.11% 8.00%
Adjusted net profit margin 7.81% -5.58% -19.63% -5.80% 8.18%
Return on Equity (ROE)
Reported ROE 16.04% -17.58% -72.16% -9.00% 11.65%
Adjusted ROE 16.04% -17.23% -71.95% -10.21% 11.91%
Return on Assets (ROA)
Reported ROA 2.25% -1.87% -7.23% -1.53% 2.42%
Adjusted ROA 2.25% -1.83% -7.21% -1.74% 2.47%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by revenue. General Electric Co.’s adjusted net profit margin ratio improved from 2018 to 2019 and from 2019 to 2020.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by shareholders’ equity. General Electric Co.’s adjusted ROE improved from 2018 to 2019 and from 2019 to 2020.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by total assets. General Electric Co.’s adjusted ROA improved from 2018 to 2019 and from 2019 to 2020.

General Electric Co., Profitability Ratios: Reported vs. Adjusted


Adjusted Net Profit Margin

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Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Net earnings (loss) attributable to the Company 5,704  (4,979) (22,355) (5,786) 8,831 
Sales of goods and services 73,022  87,487  113,544  113,192  110,390 
Profitability Ratio
Net profit margin1 7.81% -5.69% -19.69% -5.11% 8.00%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net earnings (loss) attributable to the Company 5,703  (4,879) (22,291) (6,561) 9,034 
Sales of goods and services 73,022  87,487  113,544  113,192  110,390 
Profitability Ratio
Adjusted net profit margin2 7.81% -5.58% -19.63% -5.80% 8.18%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

2020 Calculations

1 Net profit margin = 100 × Net earnings (loss) attributable to the Company ÷ Sales of goods and services
= 100 × 5,704 ÷ 73,022 = 7.81%

2 Adjusted net profit margin = 100 × Adjusted net earnings (loss) attributable to the Company ÷ Sales of goods and services
= 100 × 5,703 ÷ 73,022 = 7.81%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by revenue. General Electric Co.’s adjusted net profit margin ratio improved from 2018 to 2019 and from 2019 to 2020.

Adjusted Return on Equity (ROE)

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Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Net earnings (loss) attributable to the Company 5,704  (4,979) (22,355) (5,786) 8,831 
Total GE shareholders’ equity 35,552  28,316  30,981  64,263  75,828 
Profitability Ratio
ROE1 16.04% -17.58% -72.16% -9.00% 11.65%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net earnings (loss) attributable to the Company 5,703  (4,879) (22,291) (6,561) 9,034 
Total GE shareholders’ equity 35,552  28,316  30,981  64,263  75,828 
Profitability Ratio
Adjusted ROE2 16.04% -17.23% -71.95% -10.21% 11.91%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

2020 Calculations

1 ROE = 100 × Net earnings (loss) attributable to the Company ÷ Total GE shareholders’ equity
= 100 × 5,704 ÷ 35,552 = 16.04%

2 Adjusted ROE = 100 × Adjusted net earnings (loss) attributable to the Company ÷ Total GE shareholders’ equity
= 100 × 5,703 ÷ 35,552 = 16.04%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by shareholders’ equity. General Electric Co.’s adjusted ROE improved from 2018 to 2019 and from 2019 to 2020.

Adjusted Return on Assets (ROA)

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Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016
As Reported
Selected Financial Data (US$ in millions)
Net earnings (loss) attributable to the Company 5,704  (4,979) (22,355) (5,786) 8,831 
Total assets 253,452  266,048  309,129  377,945  365,183 
Profitability Ratio
ROA1 2.25% -1.87% -7.23% -1.53% 2.42%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net earnings (loss) attributable to the Company 5,703  (4,879) (22,291) (6,561) 9,034 
Total assets 253,452  266,048  309,129  377,945  365,183 
Profitability Ratio
Adjusted ROA2 2.25% -1.83% -7.21% -1.74% 2.47%

Based on: 10-K (filing date: 2021-02-12), 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24).

2020 Calculations

1 ROA = 100 × Net earnings (loss) attributable to the Company ÷ Total assets
= 100 × 5,704 ÷ 253,452 = 2.25%

2 Adjusted ROA = 100 × Adjusted net earnings (loss) attributable to the Company ÷ Total assets
= 100 × 5,703 ÷ 253,452 = 2.25%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by total assets. General Electric Co.’s adjusted ROA improved from 2018 to 2019 and from 2019 to 2020.