GE HealthCare (GEHC): Buy, Sell, or Hold Post Q2 Earnings? Adam Hejl Tue, October 13, 2026 at 10:35 AM EDT 3 min read GEHC +0.67% ^GSPC -0.17% Trade GEHC on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Over the last six months, GE HealthCare's shares have sunk to $68.00, producing a disappointing 7.9% loss - a stark contrast to the S&P 500's 13.5% gain. This may have investors wondering how to approach the situation.
Is there a buying opportunity in GE HealthCare, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it's free.
Even with the cheaper entry price, we're passing on GE HealthCare for now. Here are three reasons you should be careful with GEHC, plus one stock we'd rather own.
In addition to reported revenue, organic revenue is a useful data point for analyzing Medical Devices & Supplies - Imaging, Diagnostics companies. This metric gives visibility into GE HealthCare's core business because it excludes one-time events such as mergers, acquisitions, and divestitures along with foreign currency fluctuations - non-fundamental factors that can manipulate the income statement.
Over the last two years, GE HealthCare's organic revenue averaged 3% year-on-year growth. This performance slightly lagged the sector and suggests it may need to improve its products, pricing, or go-to-market strategy, which can add an extra layer of complexity to its operations.
Forecasted revenues by Wall Street analysts signal a company's potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.
Over the next 12 months, sell-side analysts expect GE HealthCare's revenue to rise by 4.4%, close to its 3.7% annualized growth for the past five years. This projection is underwhelming and implies its newer products and services will not catalyze better top-line performance yet.
Adjusted operating margin is one of the best measures of profitability because it tells us how much money a company takes home after subtracting all core expenses, like marketing and R&D. It also removes various one-time costs to paint a better picture of normalized profits.
Looking at the trend in its profitability, GE HealthCare's adjusted operating margin decreased by 1.7 percentage points over the last five years. This raises questions about the company's expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. Its adjusted operating margin for the trailing 12 months was 14.8%.
GE HealthCare isn't a terrible business, but it doesn't pass our bar. After the recent drawdown, the stock trades at 12.8× forward P/E (or $68.00 per share). This valuation multiple is fair, but we don't have much faith in the company. We're fairly confident there are better stocks to buy right now. We'd suggest looking at a dominant aerospace business that has perfected its M&A strategy.
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