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GE lower on track for the fullest day of 9 years after JPMorgan warns the worst than coming

General Electric Co. shares quashed nearly 10% on Friday to put them on track for their worst deduction since March…

General Electric Co. shares quashed nearly 10% on Friday to put them on track for their worst deduction since March 2009 after analyst Stephen Tusa, JPMorgan Chase & Co., broke its stock market target to $ 6 from $ 10 and said that the latest results of the industrial conglomerate were worse than expected on almost all fronts.

The stock return has been listed to its lowest close since March 2009 and loses its losses in the past month to about 40%, offended by its latest profitability and credit rating of all three rating agencies. [19659002] Tusa now has the lowest target for Wall Street analysts covering GE

GE, -8.24%

cementing his bearish reputation. Forecasts of free cash flow and EBITDA, or earnings before interest, taxes, depreciation, moved significantly lower in GE’s latest report, he said, while a significant change in the language of the regulated archive indicates a negative step in leverage.

“Some salesmen are pointing to” liquidity problems “as the driving force for stock market weakness, although this misconstrues the Real Bear Case (RBC) &#821

1; that is, $ 100 billion in debt and zero business-free cash flow even after a 95% dividend cut,” wrote Tuse in a note. “While the stock is down ~ 70% from the top of $ 30, this move still does not adequately reflect the basic facts, in our opinion.”

GE missed earnings and revenue estimates in the last quarter, said it would slash its dividend and reorganize its power business. Finance Director Jamie Miller said in his statement that the problems that hamper the company’s fierce power business “will continue longer and more deeply” than originally expected, which led GE to “miss significantly” the full-year cash flow and performance targets, according to a transcript provided by FactSet. Also read: GE’s warehouse has the worst day of 9 years after John Vannery, CEO, began to talk

Related: Investors who drew attention to GE Ousted CEO John Flannery pays the price to remove GE’s junk

While management said they were still planning to break up the balance sheet, the company showed quarterly 10 -Q references do not refer to $ 15 billion plus cash at year-end or $ 25 billion on industrial debt reduction, noted Tusa.

“More importantly, a specific reference to generating $ 25 billion in cash from GECS asset reduction did not appear in line with our latest analysis showing that GECS asset value is overvalued when looking at asset items on the balance sheet,” he wrote. .

Tusa is waiting for a worsening of the interest rate base to continue and predict that by 2020, six out of eight segments will show “zero” free cash flow.

The planned restructuring is far from a “kitchen counter” method, with only moderate labor costs and cash restructuring that do not comply with guidelines, he wrote. Tusa is about 60% under the Wall Street consensus for 2019 and 2020, but believes that further disadvantage is possible.

JPMorgan is holding its underweight classification on the warehouse.

Shares have fallen 53% in 2018, while S & P 500

SPX, -0.82%

has risen 4% and Dow Jones Industrial Average

DJIA, -0.68%

has advanced 5%.

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