Shares of storied industrial conglomerate General Electric (GE 1.99%) plummeted more than 7% on Wednesday, after CEO John Flannery refused to guarantee that the current GE dividend of $0.48 per share ($0.12 per quarter) was safe in 2019. This was unwelcome news, given that GE slashed its dividend by 50% just six months ago.

Investors interpreted Flannery's statement that the GE dividend would depend on free cash flow as a sign that another dividend cut is extremely likely. However, this may be an overreaction, as there hasn't been any change to General Electric's underlying free cash flow forecast.

Troubles in two key business segments aren't going away

At an investor conference on Wednesday, Flannery indicated that he doesn't see any quick fix to the problems in GE's power segment. The current market downturn will probably continue until at least 2020. That's unfortunate, because the power business has historically been one of the two biggest contributors to General Electric's earnings.

A turbine made by GE Power.

CEO John Flannery doesn't expect GE's troubled power segment to recover soon. Image source: General Electric.

Meanwhile, GE is trying to divest part or all of its insurance business, according to Reuters. This would reduce the potential for future negative surprises in the troubled GE Capital unit. However, General Electric might have to pay a substantial sum to get a potential acquirer to take over the company's insurance liabilities.

The upshot is that investors shouldn't expect a meaningful recovery in the power segment's cash production or a resumption of dividends from GE Capital to the parent company in the next few years. That means there will be less cash flow available to support GE's dividend.

The rest of GE is fundamentally healthy

While investors are fixated on the problems at GE Power and GE Capital, General Electric's most profitable business segments -- aviation and healthcare -- are strong enough to offset the company's weaknesses.

Earlier this year, GE implemented new accounting rules, which will cause segment profit for the aviation business to track cash flow more closely in the future. This will reduce earnings in the short term but increase the segment's future earnings growth. GE then restated its 2017 results, reducing the aviation segment's profit by $1.2 billion from the originally reported $6.6 billion.

In his presentation on Wednesday, Flannery stated that aviation segment profit is set to rise at least 15% in 2018, relative to the revised 2017 baseline. This would put segment profit at $6.2 billion or more. Meanwhile, the healthcare division will continue its steady growth, with segment profit up at least 5% year over year from $3.5 billion in 2017.

Additionally, Flannery reaffirmed General Electric's forecast that it will produce $6 billion to $7 billion of free cash flow this year. That's more than enough to cover the GE dividend, which costs about $4.2 billion a year.

Asset sales will provide more cash

General Electric bears have said that the company needs to cut its dividend so that it can focus on reducing its debt. Yet while it's true that GE has too much debt, asset sales will bring in plenty of cash to help the company make progress on this front.

Following a recently announced deal to divest the GE Transportation unit, GE is set to bring in about $6 billion in deal proceeds over the next 12 months. The company will also be able to sell its stake in Baker Hughes, a GE Company -- which is currently worth more than $25 billion -- starting next July. Finally, other divestitures that haven't been announced yet will probably bring in billions of dollars in 2019.

A freight train and two empty train tracks.

GE recently reached a deal to divest its railroad locomotive business. Image source: Getty Images.

To be fair, GE's divestitures will negatively impact its free cash flow, as most of the businesses being sold currently generate cash for the company. However, rising profits from the aviation segment should easily offset this lost cash flow over the next couple of years. Moreover, the aviation business is likely to continue posting strong profit growth for a decade or more.

Flannery doesn't want to overpromise

Last spring and summer, in the face of rapidly weakening financial results, former CEO Jeff Immelt and former CFO Jeffrey Bornstein assured investors that GE's dividend was safe. After he took over as CEO, Flannery reiterated that claim. Just a few months later, he had to tell investors that GE was slashing its dividend by 50%.

Given this history, it's not surprising that Flannery isn't interested in offering guarantees about the GE dividend. As he said on Wednesday, GE's ability to pay dividends depends primarily on its free cash flow production. It's too early to be certain that the company will meet its free cash flow goals in 2019.

That said, General Electric should be able to offset the cash flow headwinds from its divestitures and the problems in its power and GE Capital segments through strong growth in aviation and healthcare. As a result, GE will likely maintain its $0.48 per share dividend for the foreseeable future.