general electric

GENERAL ELECTRIC CO. $16 (New York symbol GE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 10.7 billion; Market cap: $171.2 billion; Price-to-sales ratio: 1.1; Dividend yield: 3.0%; WSSF Rating: Above Average) is buying California-based Clarient Inc. (Nasdaq symbol CLRT). Clarient’s advanced technology helps identify genes and other markers in cancer cells. This helps doctors tailor their treatments to individual patients. Demand for accurate cancer diagnoses is rising, and Clarient will help strengthen GE’s health-care operations, which supply about 25% of its revenue. The $580-million price is just 18% of the $3.2 billion, or $0.29 a share, that GE earned in the three months ended September 30, 2010. GE aims to close the deal by the end of this year. GE is a buy.

Honeywell International Inc., $46.54, symbol HON on New York (Shares outstanding: 772.2 million; Market cap: $35.9 billion), is a diversified technology and manufacturing company. It has operations in North America, Europe, Asia and Latin America. Honeywell has four main divisions: The automation and control division, which supplied 41% of Honeywell’s 2009 revenue, makes sensors, controls and security systems for homes and businesses....

ADOBE SYSTEMS INC., $26.99, Nasdaq symbol ADBE, jumped as high as $28.90 a share this week on reports that MICROSOFT CORP., $24.24, Nasdaq symbol MSFT, may launch a takeover offer for the company. A merger could help Microsoft compete in the fast-growing field of software for smartphones. Right now, Apple’s iPhone and phones powered by the free Android system, which is made by Internet-search provider Google Inc., dominate this market. Microsoft hopes to improve its market share with its upcoming Windows Phone 7 operating system. Adding Adobe’s Flash video software could give Windows Phone 7 an advantage over Apple and Android phones. As well, Adobe’s products could help Microsoft develop new software for touch-screen tablet computers....

Big companies like GE and 3M are examples of “GNP (Gross National Product) stocks”. Because they are already huge and sell to a wide variety of customers, investors feel their earnings growth may only match the growth of the overall economy. However, both GE and 3M successfully restructured their businesses during the recession. The resulting cost cuts should push their earnings higher for years to come. As well, the savings are freeing up cash for dividend increases and share buybacks. GENERAL ELECTRIC CO. $16 (New York symbol GE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 10.7 billion; Market cap: $171.2 billion; Price-to-sales ratio: 1.1; Dividend yield: 3.0%; WSSF Rating: Above Average) is one of the world’s largest manufacturers....

Desalination is the process of removing excess salt and other minerals from seawater. It’s also used where saltwater has entered underground fresh-water aquifers. Right now, there are more than 13,000 desalination plants operating in over 120 countries. In all, these plants produce more than 12 billion gallons of fresh water a day. About three-quarters of these plants are in the Middle East. That’s because desalination plants are very expensive to build, so they’re only really cost-effective where there is no fresh water. When fresh water is available, it can be pumped up to 1,600 kilometres and still cost less per litre than water from a desalination plant. The world’s largest desalination plant is the Jebel Ali Desalination Plant (Phase 2) in the United Arab Emirates. This plant can produce 219 million gallons of water per day. By comparison, the largest desalination plant in the U.S. is in Tampa Bay, Florida. That plant can produce 25 million gallons of water per day....

SPDR S&P 500 ETF $106.11 (New York symbol SPY; buy or sell through brokers) holds the stocks in the S&P 500 Index, which consists of 500 major U.S. stocks that are chosen based on their market cap, liquidity and industry group. The index’s highest-weighted stocks are Exxon Mobil, Microsoft, Procter & Gamble, Apple, JP Morgan Chase & Co., Johnson & Johnson, IBM, Chevron, General Electric, Bank of America, Wells Fargo and AT&T. The fund’s expenses are just 0.10% of its assets. If you want exposure to the S&P 500 Index, SPDR S&P 500 ETF is a buy.

Plutonic Power Corporation, $2.44, symbol PCC on Toronto (Shares outstanding: 65.4 million, Market cap: $159.6 million), is developing hydroelectric-power plants in British Columbia. These are “run-of-river” projects, which produce electricity without damming or flooding. Run-of-river hydroelectric plants do not alter downstream river flows, since all diverted water returns to the river below the powerhouse. Plutonic first sold shares to the public for $0.20 each, and began trading on Toronto in November 1999. The company owns the rights to 42 run-of-river hydroelectric sites in British Columbia. Two sites are currently under construction (East Toba River and Montrose Creek). The remaining 40 sites are at various stages of evaluation, permitting and development. Plutonic’s power sites are located near B.C.’s southwest coast, in an area that includes rivers flowing into the Toba, Bute and Knight Inlets....

UNITED TECHNOLOGIES CORP. $66 (New York symbol UTX; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 933.1 million; Market cap: $61.6 billion; Price-to-sales ratio: 1.2; Dividend yield: 2.6%; WSSF Rating: Above Average) has six main businesses: Pratt & Whitney makes aircraft engines (24% of 2009 revenue, 26% of earnings); Otis makes and services elevators (22%, 35%); Carrier makes heating and air-conditioning equipment (21%, 11%); Sikorsky makes helicopters (12%, 9%); Hamilton Sundstrand makes electronic aircraft controls (11%, 12%); and UTC Fire & Security sells burglar alarms and fire-protection services (10%; 7%). The U.S. government is the company’s biggest customer, and accounts for roughly 18% of its yearly revenue.

Recession hurt growth in 2009

Revenue rose 38.8%, from $42.3 billion in 2005 to $58.7 billion in 2008. However, revenue fell 9.8% in 2009, to $52.9 billion, as the recession cut demand for United Technologies’ aerospace and building-related products....

Vanguard Total World Stock ETF, $43.25, symbol VT on New York (Shares outstanding: 14.8 million; Market cap: $640.6 million), aims to track the FTSE All-World Index. This index is made up of about 2,800 large- and mid-capitalization stocks of companies that are located in 47 countries, including both developed and emerging markets. The ETF’s stocks are chosen by market size (their market caps must be more than $100 million U.S.) and liquidity. The ETF’s expenses are 0.30% of its assets. It yields 1.5%. Vanguard Total World Stock ETF’s top holdings are Exxon Mobil, Microsoft, Apple, General Electric, Procter & Gamble Co. Nestle SA, Johnson & Johnson, JP Morgan Chase & Co., Bank of America Corp. and BP plc....

PEPSICO INC., $66.56, New York symbol PEP, rose 2% this week after the company raised its dividend and announced a new share buyback plan. PepsiCo’s new quarterly dividend is $0.48 a share. That’s up 6.7% from $0.45. The new annual rate of $1.92 yields 2.9%. The company also plans to buy back up to $15 billion of its common shares over the next three years. That’s equal to 14% of its $104.5-billion market cap....