graphic
News > Companies
GE splits stock 3-for-1
December 17, 1999: 12:14 p.m. ET

Dividend boosted 17%; stock buyback increased by $5B
graphic
graphic graphic
graphic
NEW YORK (CNNfn) - General Electric Co. Friday declared a three-for-one stock split, boosted its quarterly dividend by 17 percent, and increased the size of its stock buyback program by $5 billion as the conglomerate prepares to unveil what’s expected to be its sixth straight quarter of record profit.
    The stock split will be payable Jan. 25 to shareholders of record Dec. 27, and is subject to anticipated approval of an increase in the authorized shares outstanding at the GE annual meeting on April 26. The split is the third for GE in the past six years and the first three-for-one split since 1954.
    The split, intended to make GE’s shares more affordable, is the company’s ninth in its 107-year history and the fifth since Chief Executive John Welch Jr. took the helm in 1981. Since Welch took over, the company's market value has risen by more than $350 billion to almost $500 billion; Microsoft Corp. (MSFT), by comparison, has a current market value of $591 billion.
    It comes at a time when the company -- the only remaining original member of the Dow Jones industrial average -- is regularly reporting record earnings and gearing itself up to be a modern, 21st Century e-business conglomerate, at which many analysts expect it will be successful.
    "I think we’re right on the cusp of a very accelerated period of growth for GE,” said Nick Heymann, an analyst with Prudential Securities. "They’re about to head into an e-business model which is completely the right direction to go in.”
    
graphic

    GE earned a record $2.65 billion, or 80 cents a diluted share in the third quarter, up 16 percent from $2.28 billion, or 69 cents a share, a year earlier. It’s expected to earn 92 cents a share in its fourth quarter, according to analysts polled by research firm First Call Corp.
    GE (GE) shares surged 6-5/8, or about 4.4 percent, to 154-1/4 in mid-morning New York trade, lifting the Dow Jones industrial average toward record territory. GE currently accounts for about 6.42 percent of the Dow 30 average.
    GE also said it will boost its quarterly dividend to 41 cents a share on a pre-split basis, and increase its share buyback program to $22 billion from $17 billion. Under the share repurchase program initiated in 1994, GE has acquired more than $15 billion of its own stock.
    "We’re very pleased to be announcing this, and we’re certainly not anticipating any opposition from our shareholders,” said Gary Sheffer, a spokesman for the Fairfield, Conn.-based company.
    GE makes an array of products from jet engines to medical imaging machines to light bulbs. It also owns the NBC television network and GE Capital, the world's biggest non-bank finance company. Back to top

  RELATED STORIES

Welch sets retirement date - Nov. 2, 1999

  RELATED SITES

General Electric


Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney




graphic


Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.