Transcripts

Citigroup & GE Put The Markets In Neutral Territory

SUSIE GHARIB: Wall Street struggled today with mixed earnings from two leading blue chip companies: Citigroup and General Electric. Shares of Citigroup rose slightly, even though the company's quarterly earnings plunged, while GE posted strong quarterly results, but its shares tumbled almost 3 percent. The giant conglomerate earned $0.64 a share, right in line with estimates. Revenues rose 11 percent to $44.6 billion, also stronger than expected. The company is restating earnings for the past six years to fix an accounting issue. That will trim $343 million off past earnings. Wall Street is split on the outlook for GE, even though the company is forecasting growth this year of 10 to 12 percent. But Standard & Poor's analyst Richard Tortoriello upgraded GE stock today to a "strong buy."

RICHARD TORTORIELLO, EQUITY ANALYST, STANDARD & POOR'S: I think that GE has turned the corner. Where it had four years of basically flat profit growth, if you look at non-restated earnings, and now it's actually starting to show good internal growth, 9 percent internal growth this past year.

GHARIB: Meanwhile, Citigroup earned $1.03 a share in the fourth quarter, $0.03 above estimates, but down 33 percent from the same period a year ago, when it realized a big gain from the sale of its mutual fund business. Revenues rose 15 percent to almost $24 billion, but expenses rose even faster, up 23 percent. Citigroup CEO Chuck Prince said today that disconnect is quote not satisfactory and the firm is engaged in a quote, long-term rebuilding effort.