GE Healthcare Soars 9% on Earnings Beat, Wise Guidance: Our New Price Target

GE Healthcare (NASDAQ:GEHC) shares jumped 9% on Thursday after the company reported strong fourth-quarter earnings and provided guidance for 2025 that exceeded analysts' expectations. The company's earnings beat and positive outlook have led analysts to raise their price targets for GEHC stock. Here's a closer look at the company's performance and our new price target.

Earnings Beat and Guidance

For the fourth quarter of 2024, GE Healthcare reported non-GAAP EPS of $1.45 on revenue of $5.32B, surpassing analysts' expectations of $1.26 on revenue of $5.33B. The company also provided guidance for 2025, with revenue growth of 1% year-over-year and an adjusted EBIT margin of 16.3%. This strong performance and positive outlook have analysts bullish on GEHC stock.

Analyst Price Targets

The 14 analysts with 12-month price forecasts for GEHC stock have an average target of $96, with a low estimate of $74 and a high estimate of $110. This average target predicts an increase of 2.55% from the current stock price of $93.61. The average target suggests that analysts believe GEHC stock is likely to outperform the market over the next twelve months.

Recommendation Trends

The average analyst rating for GEHC stock from 14 stock analysts is "Buy," indicating that analysts believe this stock is likely to outperform the market over the next twelve months. The recommendation trends show a strong buy rating from 7 analysts, a buy rating from 2 analysts, a hold rating from 4 analysts, and a strong sell rating from 1 analyst.

Latest Forecasts

Several analysts have recently updated their price targets and ratings for GEHC stock. Matthew Taylor of Jefferies upgraded the stock to a strong buy and raised the price target to $103, citing the company's strong fourth-quarter results and positive guidance. Larry Biegelsen of Wells Fargo maintained a buy rating on the stock and raised the price target to $96, citing the company's robust margin expansion and earnings growth. Vijay Kumar of Evercore ISI Group maintained a buy rating on the stock and raised the price target to $102, citing the company's strong revenue growth and positive outlook.

Strategic Initiatives and Product Innovations

GE Healthcare's recent growth and market position can be attributed to several strategic initiatives and product innovations. The company's focus on precision care, along with its commitment to innovation, productivity initiatives, and commercial execution, has driven growth in its Advanced Visualization Solutions (AVS) and Pharmaceutical Diagnostics (PDx) businesses. Additionally, the company's acquisitions and partnerships, such as the acquisition of IMACTIS and Caption Health, have helped expand its product offerings and enter new markets.

Conclusion

GE Healthcare's strong fourth-quarter earnings and positive guidance for 2025 have led analysts to raise their price targets for the stock. With an average target of $96 and a strong buy rating from 7 analysts, GEHC stock appears to be a solid investment opportunity. As the company continues to execute on its strategic initiatives and product innovations, investors can expect steady growth and a potential dividend payout in the future.