Siemens vs General Electric Which Is More Promising?

Siemens and General Electric are two of the most well-known and established companies in the industrial sector. Both companies have a long history of innovation and success in areas such as energy, healthcare, and automation. Investors often compare Siemens and General Electric stocks due to their similar size and global presence. However, the two companies have unique strengths and weaknesses that can affect their stock performance. Understanding these factors can help investors make informed decisions when considering investing in either Siemens or General Electric.

Siemens or General Electric?

When comparing Siemens and General Electric, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Siemens and General Electric.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Siemens has a dividend yield of 0.24%, while General Electric has a dividend yield of 0.55%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Siemens reports a 5-year dividend growth of 7.39% year and a payout ratio of 0.00%. On the other hand, General Electric reports a 5-year dividend growth of 86.23% year and a payout ratio of 15.38%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Siemens P/E ratio at 64.07 and General Electric's P/E ratio at 33.77. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Siemens P/B ratio is 11.79 while General Electric's P/B ratio is 11.44.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Siemens has seen a 5-year revenue growth of 0.64%, while General Electric's is -0.59%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Siemens's ROE at 20.08% and General Electric's ROE at 30.25%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹4931.90 for Siemens and $198.69 for General Electric. Over the past year, Siemens's prices ranged from ₹4562.35 to ₹8129.90, with a yearly change of 78.20%. General Electric's prices fluctuated between $126.47 and $212.19, with a yearly change of 67.78%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.