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Market Update

Earnings on Tap: General Electric

The company's increased focus on industrial business, following Comcast's remaining stake sale, is likely to drive growth over the long run.

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Industrial bellwether  General Electric (GE) is set to report first-quarter results Friday ahead of the bell, with the consensus estimate calling for $0.35 earnings per share compared with $0.29 per share reported in the corresponding period a year ago. 

The industrial and financial giant posted better-than-expected operating profit for the fourth quarter. Revenues increased 4% to $39.3 billion, topping analyst estimates.

In February, GE announced the sale of its remaining 49% stake in its joint venture with  Comcast (CMCSA) , which included NBCUniversal and NBCU floors in 30 Rockefeller Center, for $18.1 billion. The sale, which was completed last month, would likely boost GE's first-quarter earnings.

The disposition of the remaining stake in Comcast will boost GE's cash position and allow the infrastructure businesses to receive more capital and management attention, according to Morningstar analyst Daniel Holland. 

Earlier this month, GE revealed plans to acquire Lufkin Industries (LUFK) for $88.50 per share or roughly $3.3 billion in cash. This acquisition is in line with management's stated desire to add to its industrial franchise and builds on several years of acquisitions in the oil and gas space, writes Holland. 

GE's shares have gained more than 8% since the start of the year, but are still trading below Morningstar's fair value estimate.

Gazala Parveen does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.