Should I buy General Electric shares after a positive view from Credit Suisse?

General Electric Company (NYSE: GE) shares have advanced more than 5% since the beginning of the 2022 year, and the current share price stands at $101.40.

Credit Suisse has a positive view for the shares of this company, and it reported that expects upside potential for the aviation sector.

Credit Suisse sees upside potential

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General Electric is an American company that operates through the following segments: healthcare, power, aviation, renewable energy, digital industry, additive manufacturing, and finance.

General Electric’s business has proven improvements throughout the third fiscal quarter, and the company reported solid earnings results in October.

Total revenue has decreased by 5.2% Y/Y to $18.4 billion, while the GAAP earnings per share were $0.54 (beats by $0.36).

The aviation business has been a drag on its revenue growth last several quarters; still, the aviation segment is building momentum, and it is showing continued signs of recovery.

Credit Suisse reported last week that it expects upside potential for the aviation sector, and according to Credit Suisse, General Electric shares represent a buying opportunity.

Deutsche Bank also reported that it remains constructive on the airline sector for 2022 while Credit Suisse analyst Jon Walsh added:

We see more upside potential in shares of General Electric among major names with leverage to a cyclical aerospace recovery.

General Electric announced the acquisition of software company Opus One Solutions Energy, which helps electric utilities optimize energy planning, operations, and market management.

General Electric has the ability to mitigate cost pressure vs. smaller peers amidst supply chain and labor disruption issues, while the company’s management expects cash flow over the future planning period to be more than sufficient to fund growth priorities.

Despite this, we can not forget that J.P. Morgan’s analyst Stephen Tusa said in October that GE shares are at least 20% overvalued at the current price. The coronavirus pandemic continues to pose downside risks, and probably it is not the best moment for buying General Electric shares.

$105 represents current resistance

General Electric shares are advancing in 2022, but investors should consider that if the US stock market enters a more significant correction phase, shares of General Electric could be at much lower levels.

According to technical analysis, the bulls control the price action for now, and rising above $105 supports the positive trend.

On the other side, if the price falls below $90 support, it would be a “sell” signal, and we have the open way to $80.

Summary

Credit Suisse reported last week that it remains constructive on the aviation sector for 2022 and assigned a buy rating on General Electric shares. General Electric’s business has proven improvements throughout the third fiscal quarter, but the coronavirus pandemic continues to pose downside risks.

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