GE

Financial health: Strong7.8/10

6 strengths, 1 concern. Weakest points: debt to equity.

• Debt to equity: 1.10 (Concern, benchmark < 0.5) — Debt of 1.10x equity is high against the 0.5x benchmark. It has deteriorated over the last 4 years.
• Net debt vs cash flow: 1.1y (Strong, benchmark < 4 years) — Net debt of $8.1B is 1.1x annual free cash flow — about a year of cash flow to repay.
• Current ratio: 1.04 (Watch, benchmark > 1.5) — Short-term assets cover 1.04x short-term liabilities, against Graham's 1.5x floor. It has deteriorated over the last 4 years.
• Return on equity: 46.6% (Strong, benchmark > 15%) — Earns 46.6% on shareholder equity, comfortably past the > 15% mark.
• Gross margin: 31.0% (Watch, benchmark > 40%) — Keeps 31.0% of revenue after the direct cost of sales, short of the > 40% mark.
• Net margin: 19.0% (Strong, benchmark > 10%) — Turns 19.0% of revenue into profit, comfortably past the > 10% mark.
• Free cash flow: $7.3B (Strong, benchmark positive) — Generated $7.3B of free cash flow after capital spending. It has improved over the last 4 years.
• Revenue growth: 18.5% (Strong, benchmark > 10%) — Revenue changed 18.5% year on year, comfortably past the > 10% mark.
• Earnings growth: 32.8% (Strong, benchmark > 10%) — Earnings changed 32.8% year on year, comfortably past the > 10% mark.