GE, RTX, and GM Earnings Show That This Economy Is Wild. It’s a Strange Backdrop.

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For investors, it's a time to stick to the basics: Buy quality companies and don't pay too much.

This economy is wild. It isn’t easy for investors to navigate through it all. It’s time to stick to the basics: Buy quality companies and don’t pay too much.

What’s more, GM is earning less on higher car sales. Operating profit in the third quarter amounted to $3.6 billion, down from $4.3 billion in the third quarter of 2022. That’s odd too since profits typically peak with car sales. That’s exceptionally strong. It might not feel weird, but GE is supposed to be seeing margin pressure from shipping more new engines as the aerospace business heats up. New engines are essentially sold at cost or a loss and the profit is made on parts and service. There is nothing alarming about that—it’s the way the industry works.

A difference between GE and RTX is that General Electric has more aftermarket parts business, said Vertical Research Partners analyst Rob Stallard.

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