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GE · Forward model · Eliminations & Other · Culp case

What has to happen in Eliminations & Other

Model as of

This page changes Eliminations & Other inside the complete GE model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

GE forward model
Horizon
Consolidated fair value $481.20 all other verticals held in this portfolio case
Final-quarter revenue −$1.03B -4% of company revenue
Explicit segment contribution −$4.31B EBITDA less segment capex, before corporate items

Culp's own framing, taken literally: the constraint is material input, not demand, and the job is converting a backlog of more than $210 billion. Supplier material input rose double digits both sequentially and year on year, orders were $16.5 billion in the quarter, and the contracted services backlog alone is $178,705m with only 12% of it due inside a year. If supply keeps loosening at this pace the backlog converts faster than any guided growth rate implies. At 1.8 points a quarter of extra growth, 1.8 points of margin and a 27x exit, fair value is $481.20, 43.3% above the traded price. What it does not do is make the exit multiple conservative: 27x is above every large-cap aerospace comparable except Heico, and stripping it back to the base case's 20x removes about $75 a share of this case on its own.

Eliminations & Other

Basis quarter−$540M
Final quarter−$1.03B
Final revenue mix-4%

The negative reconciling line between segment revenue and consolidated revenue: intersegment sales, principally engines and parts moving between CES and DPT, plus items GE does not attribute to a segment. It exists so the four verticals sum exactly to GAAP total revenue, and it scales with intersegment volume, so it deepens as the segments grow.

Last four quarters
2026 Q1 −$520M Estimated
2026 Q2 −$540M Reported
Intersegment revenue eliminationsOther non-segment items
Sequential growth +1.8%/qtr decaying toward +1.2% Tracks segment volume; eliminations deepened 14% year on year in the basis quarter.
Eliminations & Other

Latest: −$1.03B (2031Q2E)

Period Value
2026Q1 −$520M
2026Q2 −$540M
2026Q3E −$560M
2026Q4E −$580M
2027Q1E −$600M
2027Q2E −$621M
2027Q3E −$642M
2027Q4E −$664M
2028Q1E −$686M
2028Q2E −$709M
2028Q3E −$732M
2028Q4E −$756M
2029Q1E −$780M
2029Q2E −$805M
2029Q3E −$831M
2029Q4E −$857M
2030Q1E −$885M
2030Q2E −$912M
2030Q3E −$941M
2030Q4E −$970M
2031Q1E −$1.00B
2031Q2E −$1.03B

Assumptions & reasoning

  • The 33.0% EBITDA margin is the disclosed ratio of eliminations profit to eliminations revenue: $(178)m over $(540)m in the basis quarter. Both are negative, so the product is a negative EBITDA of $(178)m - exactly the eliminations cost GE reports. It is not an operating margin and should not be read as one.
  • 2026 Q1 is the only estimated point in this model. GE prints Eliminations & Other of $(519)m for that quarter, which makes its own segment subtotal foot to $11,615m against the $11,614m adjusted revenue it prints one page later. The model uses $(520)m, the residual of the disclosed $12,392m GAAP total less CES $8,920m, DPT $3,214m and Insurance $778m, so the four lines reconcile exactly. The $1m difference is rounding in GE's table.
  • Capex is exactly zero, because a reconciliation buys nothing. Everything the company spends sits in the CES and DPT capex intensities.
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