General Electric Removed from Dow Jones Industrial Average
GE stock slide continues after selling appliance business in 2016, railroad division this spring.
NEW YORK — Walgreens Boots Alliance will replace industrial giant GE on the Dow Jones Industrial average on June 26, the S&P Dow Jones Indices announced Tuesday.
GE’s stock has tumbled in the last year, down 55% in the last 12 months and 25% in 2018. The stock continued to fall even as GE spun off parts of its business in an effort to pay down a large debt load. In 2016, it sold its appliance business to Haier for $5.6 billion, and it recently agreed to sell its century-old railroad division. GE is also looking to sell its light bulb division.
GE is the last original member of the index from 1896 and has been continuously listed in the average since 1907.
Following its latest slide, GE’s stock had the lowest share price in the index, which is weighted, meaning more valuable stocks have more of an impact on the index’s performance. S&P reported that GE had a weight of less than half a percentage point, according to CNN. The Dow looks to maintain a 10-to-1 ratio between high and low stocks in the index, according to CNN, and the gap between GE and Boeing had reached more than twice that Monday.
GE’s removal from the average reflects a shift in the American economy towards technology, finance, service and healthcare.