Yahoo Finance StockBeat - GE Rallies on CEO Stock Buy, Wall Street Backing
Investing.com – General Electric (NYSE:GE) surged on Friday, clawing back some its losses from a day earlier after its CEO Larry Culp bought shares and analysts downplayed allegations that it was involved in financial foul play.
GE CEO Larry Culp doubled his holding of GE shares this week, buying 252,000 shares for $7.93 each, according to filing with the SEC.
Shares of General Electric (NYSE:GE) rose more than 8%, clawing bac from its 11% lost a day earlier, when investors were spooked by a report accusing GE of a $38 billion in accounting fraud.
The credibility of private financial investigaor Harry Markopolos’ report was muddied following reports that he stood to benefit from a decline GE’s price. A hedge fund betting on a fall in GE’s share price paid Markopolos to produce the report and agreed to share some of the resulting profits from the short position, CNBC reported.
GE said the allegations of financial foul play were false.
Citigroup (NYSE:C) said the report had “sufficient shortcomings,” while William Blair described the report as “disingenuous” and highly inaccurate.”
Joining in on the chorus of support for GE, famed short-seller Andrew Left claimed aggressive accounting and fraud “are two different animals," adding that Markopolos' "sheriff mentality is disingenuous.”
GE up about nearly 20% this year, despite a steady downtrend following its better-than-expected first-quarter results last month. It has an average price target among analysts at Investing.com of $10.97.
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