General Electric Company (NYSE: GE) is no longer the company it was when most investors bought the stock. Share price is down 73 percent in the past three years, recently dipping below $8. GE has suffered repeated credit and analyst downgrades, earnings misses and guidance cuts. The last remaining silver lining, the stock’s dividend, was just cut for the second time in a year down to just 1 cent per quarter. For all the long-term investors who bought GE looking for a blue-chip dividend play, here are seven industrial dividend stocks Bank of America says are better investments than GE.
Eaton Corp. (ETN)
Eaton manufactures fluid power systems, automotive systems, electrical controls and truck transmissions. Analyst Andrew Obin says improvements in Eaton’s core business along with earnings per share growth should help the company close its valuation gap with peers. Eaton has lagged the market in 2018, but its 33 percent gain over the past three years is just the type of stable, long-term returns GE investors thought they would be getting. Eaton also has an impressive 3.6 percent dividend. Bank of America has a “buy” rating and $93 price target for ETN stock.
Emerson Electric Co. (EMR)
GE investors are justified in being skeptical of another electric company given GE Power’s struggles. However, Emerson Electric has navigated the market just fine in the past three years, producing a 44 percent gain for investors in addition to its 2.9 percent dividend. Emerson divested its network power and electric power businesses in 2016 and now focuses on automation solutions and commercial and residential solutions. Obin says Emerson is on the right track, and the stock’s valuation doesn’t fully reflect its long-term growth opportunity. Bank of America has a “buy” rating and $88 price target for EMR stock.
Lockheed Martin Corp. (LMT)
Lockheed Martin Corp. is the world’s largest defense contractor, with business segments that include aeronautics, missiles and fire control, rotary and mission systems and space systems. Despite concerns over a potential peak in government defense spending and a historically high valuation for LMT stock, analyst Ronald Epstein says the company’s impressive cash flow, track record of solid execution and aggressive capital return program should help support the stock in the coming years. Lockheed has a 2.8 percent dividend. Bank of America has…
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