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Personal finance observation, musing and decisions in a journey toward financial independence by 36 with at least $1 million.

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Stocks For The Long Run: General Electric (GE)





Consistent Growers: Companies with a long record of increasing their earnings every year are good bets as buy-and-hold investments. Of more than 15,000 publicly traded U.S. companies, fewer than 2% have raised their earnings for 10 straight years or longer. Through 2005 or the closest fiscal year, just 21 have boosted earnings 20 years in a row, according to America's Finest Companies, an annual reference guide.

General Electric is perhaps the most visible of these consistent growers, having posted increased earnings 30 years in a row. Nonetheless, the share price is down almost 10% since late 2004. GE's yearly growth rate is no longer at the 15% level of Jack Welch's day, in part because the company's sheer size makes that number difficult to reach.

But since CEO Jeff Immelt took over in 2001, he has divested insurance operations and focused on more promising businesses. Analysts think Immelt's efforts will pay off with double-digit earnings growth. In addition, GE offers a 2.9% dividend yield, a generous payout for such a quality stock.



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