General Electric (NYSE: GE) and Icahn Enterprises L.P. (NASDAQ:IEP) are both mid-cap multi-sector conglomerates companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, risk, profitability, earnings, dividends, analyst recommendations and valuation.

Insider & Institutional Ownership

54.8% of General Electric shares are owned by institutional investors. Comparatively, 96.8% of Icahn Enterprises L.P. shares are owned by institutional investors. 0.4% of General Electric shares are owned by company insiders. Comparatively, 90.1% of Icahn Enterprises L.P. shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares General Electric and Icahn Enterprises L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
General Electric 6.45% 14.59% 3.13%
Icahn Enterprises L.P. 6.35% 15.51% 4.18%

Analyst Ratings

This is a breakdown of current ratings for General Electric and Icahn Enterprises L.P., as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
General Electric 2 8 9 0 2.37
Icahn Enterprises L.P. 0 0 1 0 3.00

General Electric currently has a consensus price target of $29.80, suggesting a potential upside of 25.10%. Icahn Enterprises L.P. has a consensus price target of $61.00, suggesting a potential upside of 15.20%. Given General Electric’s higher possible upside, research analysts clearly believe General Electric is more favorable than Icahn Enterprises L.P..

Valuation & Earnings

This table compares General Electric and Icahn Enterprises L.P.’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
General Electric $118.85 billion 1.74 $17.92 billion $0.81 29.41
Icahn Enterprises L.P. $18.67 billion 0.47 $1.85 billion $7.85 6.75

General Electric has higher revenue and earnings than Icahn Enterprises L.P.. Icahn Enterprises L.P. is trading at a lower price-to-earnings ratio than General Electric, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

General Electric has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500. Comparatively, Icahn Enterprises L.P. has a beta of 1.72, meaning that its share price is 72% more volatile than the S&P 500.

Dividends

General Electric pays an annual dividend of $0.96 per share and has a dividend yield of 4.0%. Icahn Enterprises L.P. pays an annual dividend of $3.00 per share and has a dividend yield of 5.7%. General Electric pays out 118.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Icahn Enterprises L.P. pays out 38.2% of its earnings in the form of a dividend. Icahn Enterprises L.P. is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Icahn Enterprises L.P. beats General Electric on 9 of the 16 factors compared between the two stocks.

General Electric Company Profile

General Electric Company is a global digital industrial company. The Company’s products and services range from aircraft engines, power generation, and oil and gas production equipment to medical imaging, financing and industrial products. Its segments include Power, which includes products and services related to energy production and water reuse; Renewable Energy, which offers renewable power sources; Oil & Gas, including liquefied natural gas and pipelines; Aviation, which includes commercial and military aircraft engines, and integrated digital components, among others; Healthcare, which provides healthcare technologies in medical imaging, digital solutions, patient monitoring and diagnostics, and drug discovery, among others; Transportation, which is a supplier to the railroad, mining, marine, stationary power and drilling industries; Energy Connections & Lighting, which includes Energy Connections and Lighting businesses, and Capital, which is a financial services division.

Icahn Enterprises L.P. Company Profile

Icahn Enterprises L.P. (Icahn Enterprises) is a holding company. The Company’s segments include Automotive, Energy, Metals, Railcar, Gaming, Food Packaging, Mining, Real Estate and Home Fashion. The Company’s Investment segment includes various private investment funds. The Company operates its Automotive segment through its ownership in Federal-Mogul Holdings Corporation and IEH Auto Parts Holding LLC. The Company operates Energy segment through its controlling interest in CVR Energy, Inc. It operates its Metals segment through its subsidiary, PSC Metals, Inc. The Company operates its Railcar segment through its ownership interests in American Railcar Industries, Inc. Its Food Packaging segment consists of ownership in Viskase Companies, Inc. The Company’s Real Estate operations consist of rental real estate, property development and associated resorts. It also owns a limited partner interest in Icahn Enterprises Holdings L.P. (Icahn Enterprises Holdings).

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