Ahead of the Bell: JPMorgan downgrades GE

NEW YORK (AP) _ An analyst downgraded shares of General Electric Co. on Monday, predicting a challenging environment for its business operations.

JPMorgan's C. Stephen Tusa Jr. cut GE — a conglomerate that has segments in media, aerospace, household appliances and elsewhere — to "Neutral" from "Overweight" in a note to investors.

Tusa predicted difficulties for GE's operations. In particular, he predicted sharply slower sales for its aviation unit amid capacity cuts at U.S. airlines, while income in from its real estate operations is likely to be lower on challenges in the real estate market.

In addition, the analyst saw challenges for NBC Universal on weaker advertising sales, while its industrial segment could also see slower sales.

Still, Tusa said the Fairfield, Conn., company continues to have attractive assets and talented management that could move the company forward if it were restructured properly.

A phone call seeking comment from GE was not immediately returned early Monday.

Tusa lowered his 2009 earnings outlook to $2.30 per share from $2.42. Analysts polled by Thomson Financial expect earnings of $2.44 per share.

GE shares lost 32 cents to $28.83 in premarket trading Monday. The stock closed at $29.15 on Friday.