|New Threads Only:|
|New Threads & Replies:|
Forum List » Value Ideas and Strategies|
Share and discuss value investing ideas and investing strategies.
GE - Focusing on the Growing LED Lighting Market
Posted by: shash63 (IP Logged)
Date: April 29, 2014 04:02PM
The LED light market is one of the fastest growing markets as the conventional incandescent light is being replaced by LED lights. The global LED lighting market is anticipated to grow at a CAGR of 35.6 percent over the period 2012 to 2016. One of the key factors contributing to this market’s growth is the declining price of LEDs and also the various energy saving benefits offering lower operational costs.
Various rebate schemes offered by the government have also leveraged the growing acceptance of LED lights in the home lights segment. To ride on this growth market, General Electric (GE) is now a lot more focused on this market to leverage its top and bottom lines.
GE’s focus on the growing LED lights market is fortified by its acquisition of various LED lights and fixtures companies in the recent past. The buy outs in the past are assisting GE to attain a bigger share of global LED lighting market. The LED lighting market was worth $4.8 billion in 2012 and is anticipated to go to $42 billion by 2019.
The company operates in various divisions which contribute to its total revenue. LED lighting is part of GE lights and appliance sections. The appliance and light division reported revenue of $1.857 billion with segment profits of $53 million. LED light was the only segment of the lighting and appliance division which recorded growth of 33%. This further goes on to strengthen the LED segment of GE.
GE is an established name for decades to provide turnkey lighting solutions for industrial lighting, outdoor lighting and home lights. Various researches go on to reveal that by 2015, LEDs will become the second-leading type of lamp for street lights in terms of sales. By 2020, the study concludes that LED lamps for street lights will generate more than $2 billion in annual revenue. GE lighting offers a wide range of street light solutions which will enable them to have a major share of $2 billion anticipated market in next few years.
GE LED lights have been selected by Wal-Mart, which plans to purchase LED ceiling lighting fixtures for new supercenters in the U.S., stores in Asia and Latin America, and various locations in the UK. This is Walmart’s largest purchase of GE LED lighting to date, and the most recent example of leadership from Wal-Mart and GE to find and scale innovative, energy-efficient lighting solutions.
Another marker leader in LED lighting is Cree (CREE), which also is one of the leaders in LED lights fixture and LED chips. Cree is the company which concentrated more on in-home LED lights and is one of the companies that provided low-cost home LED lights. It was the first one to hit the $10 barrier in LED home lights which was also followed by companies like Philips.
The third quarter 2013 results of Cree were very impressive and posed year-over-year growth in top and bottom lines. The company recorded $405 million in revenue which is 16% year-over-year growth with a net income of $28 million, a 27% year-over-year growth. The growth in the top line of the company was a result of a boost in sales to record 37% year-over-year growth.
Looking into the growth of LED lighting markets companies like GE and Cree are sure to reap the benefits of this growth market. From the investor front, GE has multiple sources of revenue segments which maks it a safe bet. While Cree is mainly into LED lighting solutions as its core business, it gives stringent competition to GE light. But GE is mainly into outdoor and street lighting while Cree mainly focuses on home lights. Both these companies can always be eyed by an investor for long-term growth.
Stocks Discussed: GE,
Re GE - Focusing on the Growing LED Lighting Market
Posted by: jakeflamingau@yahoo (IP Logged)
Date: May 1, 2014 07:33AM
New LED Technology uses Nano-particles to get Natural Eco-Friendly light like sunlight.
Stocks Discussed: GE,
Disclaimers: GuruFocus.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on GuruFocus.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The gurus may buy and sell securities before and after any particular article and report and information herein is published, with respect to the securities discussed in any article and report posted herein. In no event shall GuruFocus.com be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on GuruFocus.com, or relating to the use of, or inability to use, GuruFocus.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. The gurus listed in this website are not affiliated with GuruFocus.com, LLC. Stock quotes provided by InterActive Data. Fundamental company data provided by Morningstar, updated daily.