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NEW YORK (dpa-AFX) – The shares of GE Healthcare (GE Healthcare Technologies) rose significantly on the first day of its spin-off from parent company General Electric (GE) (General Electric). They were up 8 percent to $60.49 at the close Wednesday, after starting at $54.13. Adjusted for the spin-off, General Electric stock closed 6.4 percent higher at $70.20.
For every three GE shares, the shareholders of the conglomerate received one new GE Healthcare share (GE Healthcare Technologies) in their securities account the evening before the market closed. In as-is-issue trading, prices had fluctuated between $53 and a good $66 since mid-December, most recently $56 was paid in over-the-counter advance trading. After the spin-off, General Electric will still hold up to almost 20 percent of the outstanding GE HealthCare shares.
The DZ-Bank expert Robert Czerwensky evaluates the spin-off measure positively, as it could disclose hidden reserves and reduce General Electric’s conglomerate discount. The shareholders could now decide for themselves whether they continue to believe in the growth prospects of the healthcare division.
The spin-off is considered a big step in the restructuring of the conglomerate. Czerwensky added that the change to a pure aviation technology company would then be completed in a year with the planned spin-off of the energy activities under the name GE Vernova. He continues to recommend GE stock as a buy at fair value, which he put at $76. This is slightly higher than the previous target, which he calculated to be $72.57 adjusted for the IPO./tih/la/jha/ajx/he/ajx/he
Leverage must be between 2 and 20