One of Wall Street's biggest bears when it comes to General Electric (NYSE:GE) shares said Wednesday that he believes consensus expectations for the industrial conglomerate are bound to be "reset" due to ongoing issues at the company's aviation unit.

Shares of GE are down more than 35% year to date, and 72% over the past five years, as the company tries to dig out from a massive debt burden due to acquisitions last decade. GE went into 2020 expecting to experience a multiyear turnaround, but its challenge has only grown more difficult as the COVID-19 pandemic has sent airlines tumbling and created weakness at its once-strong aviation division.

GE9X Engine on a plane.

Image source: General Electric.

GE said in March that it would cut its overall aviation workforce by about 10%, and the company said last week that it expects cash burn will be worse than expected in the current quarter.

JP Morgan analyst Stephen Tusa in a note out Wednesday says expectations are still too high, citing numbers presented by aircraft engine rival Raytheon Technologies (NYSE:RTX) at an investor conference. Raytheon said all of its positive free cash flow in 2020 would come from its defense operations, and not commercial aerospace.

The comments, Tusa said, "inform something worse than our well below consensus thinking on the GE Aviation model."

Tusa has a good track record in recent years predicting issues at GE and warned in April that the stock is "the most expensive value trap we have ever seen."

Despite the issues, Tusa is keeping his "neutral" rating on the shares. With the stock trading below $8 per share, there isn't a lot of further room to fall, but there appears no catalyst to get the shares rocketing higher in the foreseeable future.

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