Thanks to an upgrade of the company, from J.P. Morgan, the shares of General Electric rose 4.54%. The analyst, Stephen Tusa, now rates GE as "Overweight" because the worst seems to be over for the company; even if GE ends up raising money through a secondary offering, said Mr. Tusa, it would be good for the stock because it would dispel undercapitalization doubts.
Mr. Tusa could very well be right, but note the "even bad news is good news" thrust. Call me a worry wart, but that kind of reasoning makes me jumpy even if the troubled banks have shown the same effect over the last several months. Mr. Tusa's price target of $17 will likely be met from the latest close of $14.50, but I believe the path will be fairly jagged. I've been burned myself by "all clear ahead" bullishness.
Berkshire's 2014 Letter
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