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Taking Stock: Buying Swiss and selling American

Selling GE to buy Swiss telecom stock is “a big mistake.”
Modified: August 2, 2013 at 11:43 pm •  Published: August 4, 2013
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And I almost fell off the floor when you wrote that you might sell 400 shares of General Electric (GE-$24.50) to purchase 200 shares of Swisscom! Cheese and crackers got all muddy and son of a biscuit, selling GE is downright un-American. This is a stock that should be in every American's long-term growth and income portfolio. What's good for GE is good for America, and what's good for America is good for GE. This company is as American as Babe Ruth, barbecued ribs, drive-in movies and Kentucky bourbon. And with the exception of the automobile industry, long-term investors have had good success with nearly every stock that has the name “General” in its title.

GE was formed in 1892 via the merger of Edison General Electric Co. and Thomson-Houston Co. In 1896, it was one of the original 12 companies that formed the Dow Jones industrial average, and after 117 years, it's the only one of the original companies still listed on the index.

Today it's one of the largest and most diversified technology and financial services companies on the planet. With products including power generation, household appliances, jet engines, water processing, medical imaging, aerospace systems, mining equipment, many types of engines, business and consumer financing, and lighting products, GE serves customers in more than 100 countries. Revenues for 2013 are expected to be $156 billion. Earnings should be $1.70 a share, and GE has a 76-cent dividend, which yields 3.2 percent. Going out four years, the consensus expects GE to report $190 billion in revenues, post earnings of $2.80 a share, pay a dividend of $1.25 and trade at $50. So selling a classy company such as GE would be a big mistake, as well as unpatriotic.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775, or email him at mjberko@yahoo.com.

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