General Electric (GE) Acquires BK Medical, To Buy Opus One

General Electric Company GE yesterday announced the completion of the acquisition of Boston and Copenhagen-based BK Medical in a cash transaction valued at $1.45 billion. The seller in the transaction was Altaris Capital Partners.

The buyout deal was announced by General Electric in September 2021.

In addition, General Electric yesterday announced that its unit GE Digital will acquire Ontario, Canada-based Opus One Solutions Energy Corporation. The financial terms of the transaction have not been disclosed.

Shares of General Electric gained 3.42% yesterday, ending the trading session at $93.06.

Inside the Headlines

BK Medical is a leader in intraoperative imaging and surgical navigation. Designed for surgeons and urologists, the company’s active imaging systems facilitate in visualizing anatomy and lesions, guiding interventions and navigating inside the body of a patient. The company, which employs more than 650 people, has a strong product line that is used across several medical specialties, including general surgery, robotic-assisted surgery, neurosurgery and spine, and urology.

General Electric will benefit from BK Medical’s expertise in advanced ultrasound technology, its strong innovation capabilities and efficient team. Through solid product offerings, providing precision health to customers will become easier. Beside boosting the ultrasound business, the buyout will help General Electric expand into the therapeutic interventions, diagnostics and surgical space.

The BK Medical buyout is expected to boost General Electric’s revenues, margins and free cash flow. Also, a return of high-single-digit on invested capital is predicted by the fifth year of the completion of the acquisition.

General Electric’s Healthcare segment will house the operations of BK Medical. The segment provides technologies in patient monitoring, medical imaging, drug discovery, and others. It also offers biopharmaceutical manufacturing technologies. The segment generated revenues of $4,339 million in the third quarter of 2021.

Then again, the buyout of Opus One will enhance GE Digital’s capabilities to support the use of renewable and distributed energy resources. Opus One is a software provider helping electric utilities in energy planning and operations as well as market management.

General Electric anticipates closing the transaction in the coming 30 days.

Zacks Rank, Estimate Trend and Price Performance

With a market capitalization of $98.8 billion, General Electric currently carries a Zacks Rank #3 (Hold). The company stands to gain from solid contract wins, acquired assets, a strong liquidity position, and the restructuring of its portfolio. However, supply-chain hurdles are likely to remain concerning.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past three months, the company’s shares have lost 9.6% compared with the industry’s decline of 11.3%.

Image Source: Zacks Investment Research

Meanwhile, the Zacks Consensus Estimate for General Electric’s earnings has decreased 4.5% to 84 cents per share for the fourth quarter of 2021 and has increased 10.4% to $2.02 for 2021 in the past 60 days. Likewise, the consensus estimate for 2022 has increased 6.1% to $4.02 in the same timeframe.

General Electric Company Price and Consensus

General Electric Company price-consensus-chart | General Electric Company Quote

Three Players in the Sector With Active Buyouts

Three stocks in the industry, which are actively engaged in buyouts, are discussed below.

Danaher Corporation DHR acquired Canada-based Vanrx Pharmasystems in February 2021, while Swift Biosciences was added to its portfolio in first-quarter 2021. In August 2021, Danaher acquired Aldevron. DHR presently carries a Zacks Rank #3.

Danaher’s shares have lost 3.4% in the past three months. The Zacks Consensus Estimate for DHR’s earnings has increased 2.1% for 2021 and 1.6% for 2022 in the past 60 days.

Carlisle Companies Incorporated CSL acquired California-based Henry Company in September 2021. CSL presently carries a Zacks Rank #3.

Shares of Carlisle have gained 15.7% in the past three months. The Zacks Consensus Estimate for CSL’s earnings has been unchanged for 2021 and risen 0.4% for 2022 in the past 60 days.

Federal Signal Corporation FSS agreed to acquire Deist Industries Inc. in November 2021. It added Ground Force Worldwide to its portfolio in October and bought OSW Equipment and Repair, LLC in February.

Shares of Federal Signal have gained 4.7% in the past three months. The Zacks Consensus Estimate for FSS’ earnings has decreased 4.3% for 2021 and 1.8% for 2022 in the past 60 days.

Breakout Biotech Stocks with Triple-Digit Profit Potential

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.