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General Electric Co.'s chief executive John Flannery is shown in this undated handout photo.Handout/Reuters

General Electric Co.'s stock plunge deepened as its top leaders failed to soothe shareholder concerns about the turnaround plan for the embattled icon of American business.

Chief executive John Flannery acknowledged that it's "show-me time" for investors as the company seeks to show concrete results from the overhaul he outlined a day ago. In an interview on Tuesday on CNBC, he said he wasn't surprised by the negative stock reaction after "we disappointed people with some tough news," including a dividend cut and a lower 2018 earnings forecast.

Mr. Flannery plans to focus GE on three businesses – power, aviation and health-care equipment – while exiting others that have long defined the 125-year-old manufacturer. The highly anticipated strategy stopped short of a full-scale breakup or other radical change, leaving investors to question how quickly GE can recover from problems such as a slowdown in the power-generation market.

"There's a big challenge ahead of GE," said Scott Lawson, vice-president at Westwood Holdings Group Inc., which sold most of its GE shares earlier this year. After Monday's presentation, "you really have no reason to change your outlook on the business."

GE sank almost 6 per cent to $17.92 (U.S.) as markets closed in New York after tumbling the most in eight years on Monday. The stock price is at its lowest intraday level in almost six years. GE on Monday said it would explore options to get out of industries such as lighting and locomotive-manufacturing, while also weighing an exit of its stake in Baker Hughes, a provider of oil field equipment and services. GE will retain businesses that accounted for about 80 per cent of revenue last year.

The company also cut its quarterly dividend in half – to 12 cents a share – and dramatically lowered per-share profit expectations for next year from the $2 target it has discussed since 2015. Under GE's new forecast, earnings will be $1 to $1.07 a share in 2018, which Ms. Flannery called a "reset" year.

"The company's turnaround will now be more protracted than previously anticipated," said Deane Dray, an analyst at RBC Capital Markets. He cut his rating on GE on Tuesday to sector perform and reduced the share-price target to $20 from $25.

"The bottom line is that Mr. Flannery's plan fell short of the sweeping reset that investors were looking for," he said.

Chief financial officer Jamie Miller made a case for GE's prospects during a presentation on Tuesday at a Goldman Sachs Group Inc. conference. Mr. Flannery plans to continue the Wall Street appeal on Wednesday at a UBS Group AG event.

Legacy issues with pension and insurance operations could continue to weigh on the company as it deals with challenges in the power market, according to Jeff Sprague, an analyst at Vertical Research Partners. With little hope of a near-term rebound, investors could be in for a "slow grind," he said in a note to clients.

"We believe GE has set a plausible guidance framework for 2018, but are not confident there is a strong growth outlook off the new base," wrote Mr. Sprague, who cut his price target to $18 from $20. "Power markets will likely remain challenged through the end of the decade. Aviation looks strong, but is in a 10-year upcycle that won't run forever, and Healthcare just plods along."