Some companies see their shares do incredibly well after their earnings reports. General Electric Co. (NYSE: GE) shareholders may not feel like they are exactly holding a crown jewel, compared with the good old days when GE was the world’s largest and most dominant conglomerate. Now GE has a very troubling stock price after earnings, it has lost its prestige and invincibility and, frankly, many investors have a hard time understanding GE’s business model.

While GE is facing multiyear challenges and needs to effect a turnaround during a deep recession, its long-term opportunities under new leadership could make it an overlooked sleeper stock that could surprise investors in the years ahead.

The difficulties and threats brought on by the COVID-19 pandemic have been unique and unprecedented. GE had operating troubles already, but the woes of the airline industry took its prized aviation business from shinola to something much worse. The conglomerate appears to be in a position in which shareholders need to wonder how GE will fly out of the storm.

GE’s earnings report for the second quarter of 2020 might have had some tidbits of stabilization to some investors. The bottom line, and what the stock market decided to focus on, was that GE’s cash flow and earnings were in the red. GE is now valued at just $53 billion, and it no longer dominates the conglomerates. Its problems were bad enough that GE even was kicked out of the Dow Jones industrial average, after being the longest-serving member of that index.

GE’s earnings report was covered in more detail after the announcement was made last week, but its adjusted loss per share of $0.15 on revenues of $17.7 billion were down from adjusted earnings of $0.16 per share on revenues of $28.83 billion. Its results compared to the consensus estimates for a loss per share of $0.10 on revenues of $17.12 billion. The worst part of the news was that GE registered negative free cash flow of $2.1 billion in its Industrial businesses during the quarter.

The general feeling that shareholders will have is that GE’s flight path to recovery looks weak. One harsh reality is that GE’s glory days of decades past are gone. Even the most bullish analyst probably would concede that point. It may never come back to anywhere what the company used to be, or at least will take ages to do so. Even superstar CEO Larry Culp is having more than a hard time during a pandemic recession, now that Aviation is in the latrine.

All that said, if GE can get any momentum going and as Aviation gets back to some form of normality, there could be some hidden leverage that propels it much higher in the coming years. And yes, that is plural.

24/7 Wall St. has tracked multiple analyst calls after the earnings report. The company also will be highly dependent on a broader economic recovery, particularly in aviation. GE’s stock fell for three consecutive days, from $6.89 ahead of earnings, for a total loss of almost 12% to $6.06 by the end of the week. Its reaction on Monday has been positive, but not by enough (0.3%) that shareholders are going to feel great.

Multiple firms on Wall Street had a lot to add in here, and some of them remain quite positive, if they are looking out beyond just 2020 and even 2021.

Credit Suisse maintained its Neutral rating, but the firm’s John Walsh cut his price target to $7 from $8. He noted that GE’s complexity remains elevated and its bridge into 2021 remains uncertain, even as several tailwinds and headwinds were sized up, with a focus on trade working capital. The firm sees free cash flow up in the fourth quarter but has less conviction around the third quarter, despite the $2 billion-plus in cost savings.

CFRA maintained its Hold rating, and the target price from Colin Scarola is $6. His view is based on 15 times the firm’s 2021 per-share earnings target but is after it missed earnings with a severe decline in Aviation, with operating losses in Power and Renewable Energy. Yet, the firm believes that GE’s 40% stock decline in 2020 leaves its shares near fair value.

Deutsche Bank maintained its Hold rating on GE but trimmed its target price to $6.25 from $6.50.

Zacks Investment Research decided to downgrade GE to Underperform from Neutral, effectively issuing a Sell rating. Zacks also slashed its price target to $5 from $7.

S&P Global Ratings only covers GE’s corporate credit (BBB+ and Negative) and noted many factors that would keep GE’s debt leverage high while its industrial organic revenue is down 20% and with a $521 million adjusted industrial loss in the quarter. In part based on cost measures, S&P expects a gradual recovery in operating performance to start in the second half of 2020, with credit metrics improving in 2021. Still, S&P anticipates that the recovery “will be bumpy and long.”

Another call came from analyst John Inch at Gordon Haskett. He has a Hold rating and a mere $5 price target. Declining aerospace margins and a slower than expected aerospace aftermarket recovery were the main notations.

Again, some analysts were positive, or at least less negative. Those defending GE probably would rather be able to issue a 36-month or 48-month target price rather than a 12-month or even a year-end one.

Barclays analyst Julian Mitchell maintained an Overweight rating with a $9 price target, and he has noted that GE’s declining margins were more or less at his expectations at the same time there was a lower than expected cash burn rate.

RBC’s Dean Dray kept his Outperform rating, and he has a $9 target price. To him, the results were better than feared. He also noted that GE’s cash burn was slower than expected, and GE’s guidance remaining suspended was due to the macro uncertainty.

Independent research firm Argus has a Buy rating and maintained a $9 price target on GE. Its view is longer term, rather than short term, calling GE a deep value idea with a chief executive who is focused on cutting costs and preserving cash during the pandemic. For a time, GE’s prior progress on its turnaround under the new CEO was coming along, but that turnaround will now take more time.

Argus also noted that GE’s Healthcare segment is experiencing a surge in orders for COVID-19-related products, but the other businesses (particularly Aviation now) are holding the stock down. The firm thinks the company has the cash it needs to survive the crisis, and believes it that Culp is an able manager to lead it on the other side, even if earnings will be deeply challenged in 2020. Another view down the road is a scenario in which GE could get its earnings power back up to as high as $1.50 per share, with an operating margin nearer to the industry average of 15%.

For an incredible upside view, Argus would get closer to a $25 valuation if an industry-average multiple can be used. Still, the report admitted that is a long way off, even if progress under Culp will lead to higher earnings and higher multiples. Argus’s price objective had been at $10 at one time.

Of the large firms that were tracked with post-earnings calls, BofA Securities has remained the peak optimist. Its Andrew Obin has a Buy rating and an $11 price objective. While the woes around Aviation limit the visibility, his is a glass “half-full” view, with plenty of positives on cash flow, costs and industrial operations. He lifted his earnings expectations to a loss of 20 cents from a loss of 30 cents per share, and he sees GE returning to profits at $0.29 per share in 2021 and $0.57 in 2022.

Obin’s Investment Rationale under new leadership argues that GE is making operational improvements while lowering its structural costs. While GE faces near-term pressures in Aviation, GE’s diversified portfolio includes Healthcare, Power and Renewable Energy, which should all contribute free cash flow improvements and ultimately to a higher stock price.

Reading through this many reports makes it clear that little doubt remains that GE’s challenges are not over and that its future is not set to an assured recovery. Many long-term factors still could play a role in GE managing to sneak its way back into favor. If the GE perma-bears finally start looking positive, with much better comments about GE and Larry Culp, it’s probably a safe bet that the stock market will have started pricing that in already.

Remember that no single analyst report, no matter how convincing it is to the upside or downside, should ever be used as the sole influence for buying or selling a company’s securities.

General Electric stock was up 1.1% (up seven cents) at $6.14 in early afternoon trading on Monday. Its 52-week range is $5.48 to $13.26.

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