In the investing world there is a great deal of looking backwards because we do not know the future but we can project some knowns from the past. If you believe in cycles, eventually the market will go higher and lower, when it will happen is the tricky part. If you are investing for the long term, looking at past history for profit companies that can and did pay dividends for years and decades and some cases generations is a very good thing to do.

In an article from Reuters, one of those companies that paid dividends and the stock also outperformed the market was GE. The lightbulb was the consumer aspect of GE, but it was active in many subsidiaries that went put together rose to be the most valuable US corporation and global symbol of American business power. The GE company was a spot in the Dow Jones Industrial Average for more than 100 years.

In 2008, the high-flying GE Capital was loaded with both leverage and mortgage bonds and when that market tanked to be pennies of the dollar, GE was worth pennies rather than dollars. Before 2008, the CEO demanded all divisions either be 1,2 or 3 in market share or be sold. To reach the level, risk was taken, sometimes risk is wonderful, sometimes it is awful.

The new CEO was put in and is still Larry Culp and it has taken almost 15 years to turn the company around. Mr. Culp focus has been on paying off debt by selling assets and improving cash flows by steam lining operations and cutting overhead costs. The company is smaller and leaner as compared to before 2008.

The company has broken the company into 3 which all trade on the stock exchange, GE, GE Vernova – the aerospace and energy business and GE Health Care. CEO Culp has slashed more than $100 billion in debt and quadrupled its free cash flow since 2018. Its market cap was grown from $100 billion to $192 billion.

Linking to dividend paying stocks, with these stocks you will like the fact they can pay dividends on a consistence basis and for the most part you really only look at them a couple of times a year. The point of this column is when companies get into trouble, it will take years to return to their formal balance of power. While the company is transforming itself, it will take years to regain its traditional stance in the markets ratings. Perhaps it would be easier to watch the development while you see alternatives. Love people, company stock you can buy and sell.

There are more questions than answers, till the next time – to raising questions.