General Electric extends 2-day decline to 14% as JPMorgan's Stephen Tusa sticks with $5 price target

• Shares of General Electric have plummeted as much as 14% over the past two days after the company held its analyst day.
• Investors are souring on the company's plan to combine its GE Capital Aviation Services unit with AerCap as well as its reverse stock split.
• JPMorgan analyst Stephen Tusa thinks the downside in General Electric is not over, as he sticks with his $5 price target.
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General Electric investors are souring on the company's plans revealed at analyst day earlier this week, with the stock falling as much as 14% over the past two-days.

The company announced plans to combine its GE Capital Aviation Services unit with AerCap in an effort to reduce its debt burden by about $30 billion. On top of that, the industrial company said it plans to initiative a 1-for-8 reverse stock split to bring down its nearly 9 billion share count.

JPMorgan analyst Stephen Tusa thinks there's more downside left for General Electric. Tusa reiterated his Neutral rating on the company and maintained his $5 price target in a note on Thursday, representing potential decline of 59% from current levels.

Tusa argues that General Electric bulls can no longer point to the GE Capital Services unit as a source of value for the stock since the company is merging the unit with AerCap.

"Starting yesterday, there are no longer GE Capital assets around which Sell Side Bulls can argue there is enough value/equity to support related debt," Tusa said. The average sell side price target for General Electric is $13, Tusa noted.

Some investors have cheered General Electric's decision to offload GE Capital Services, as it is now a pure play industrial company. But Tusa still sees weakness in those businesses as well.

"We continue to see structural concerns in the key Power markets, and now structural weakness at Aviation, combined with still relatively high financial leverage, and numerous tail liabilities for both GE and GE Capital Services, all hurdles to a speedy turnaround," Tusa said.