What happened

Shares of General Electric (GE 5.76%) fell more than 5% on Thursday, nearly double the S&P 500's decline, after a Wall Street analyst said he sees little reason to get excited about the company right now. GE is making progress, but the turnaround is going to take time.

So what

General Electric has had a difficult run, with its shares down more than 70% compared to the company's growth stock heyday in the late 1990s. In recent years, GE has been trying to dig out after taking on too much leverage and making some market-topping acquisitions.

GE is on its third CEO since August 2017, and has been making progress getting its house in order. But in a note out Thursday, Cowen analyst Gautam Khanna said that he sees "limited upside" to the stock despite the improvements.

A GE9X Engine hangs off the wing of a commercial aircraft.

General Electric's GE9X engine. Image source: General Electric.

Khanna praised new CEO Larry Culp for improving transparency during the company's recent outlook presentation but said despite all the moving parts surrounding GE, the stock looks fairly valued.

Khanna wrote that if assigning a multiple of 18 to 20 times the $5.5 billion to $7 billion industrial free cash flow the company hopes to achieve in 2023, the implied equity value of the company would be between $11 and $13 per share. GE shares closed at $10.95 on Wednesday.

Now what

GE under Culp has done a lot to restore investor credibility and convince markets that criticism the company is "a bigger fraud than Enron" is off the mark. But this is a huge company with difficult issues, including a massive need for deleveraging and energy businesses that continue to sputter.

There are new risks emerging as well, including a potential commercial aerospace slowdown that could eat into GE's successful aircraft engine business.

With so many balls in the air, and with such a long time horizon to get GE's house back in order, there doesn't seem to be much reason to rush into the shares right now.