Alongside the rest of the market, shares of beaten-up industrial conglomerate General Electric (NYSE:GE) have rebounded strongly in 2019. Year-to-date, GE stock is up 20%, marking one of the stock’s biggest and longest rallies in recent memory.

But, most of that rally happened in the first two months of the year. GE stock went from essentially $7 in late December, to $11 in late February, amid a series of positive operational developments, most of which were centered around downsizing and simplifying the overly complex and confusing GE portfolio. Since then, the rally has stalled out. Indeed, since late February, GE stock has actually dropped more than 15%. During that same stretch, the S&P 500 index has gained more than 3%.

So, one has to ask: Has the GE stock turnaround already come and gone? I asked this question back in early March. My answer back then was “Yes” and that’s still my answer. I’d like to add that the stock isn’t worth buying on this dip just yet. In the big picture, there are more questions than answers here, and this lack of clarity will continue to challenge GE stock for the foreseeable future.

All in all, while I love a good turnaround story, I think the best of the GE turnaround is already behind us. Now, General Electric stock is cooling off after a big turnaround, and this chill is here to stay so long as the narrative has more questions than answers.

The Turnaround Already Happened

The GE turnaround in late 2018 and early 2019 was strong while it lasted. But, now it’s over.

GE stock bottomed at the infamous $6.66 level back in December, and then proceeded to rebound strongly over the next few months as the fundamentals dramatically improved. Namely, the global economy stabilized, industrial activity picked up, and GE finally sold some assets and downsized operations to reduce leverage and improve long-term profitability. The sum of these tailwinds all converged in early 2019, and GE stock soared 57% by the end of February.

Over the past month and a half, though, this rally has cooled, mostly because there haven’t been any noteworthy catalysts. There haven’t been any big business divestitures or asset sales. The March guidance update wasn’t great. Analysts have stopped upgrading, and there’s actually been a series of Wall Street downgrades recently.

All in all, all those positive catalysts that powered GE stock from $7 to $11 earlier this year, have now either disappeared (no more big spin-offs) or turned into headwinds (analyst upgrades have turned into downgrades).

The result? The turnaround in GE stock has ended, and has been replaced by a new multi-week downtrend. Based on present fundamentals and a lack of clarity as to what will happen next, this new downtrend will likely persist for the foreseeable future.

Lack of Clarity Limits Upside

The biggest knock against GE stock at the present moment is that no one really knows what will happen next, and in the stock market, a lack of clarity almost always leads to downward pressure .

Broadly speaking, GE is trying to downsize and simplify its far-too-complex portfolio of operations and business in order to focus on targeted growth, improve long term profitability, and reduce leverage. This sounds good. If management pulls this off, then the GE of tomorrow will be much more financially healthy, stable and viable. Thus, there aren’t any questions with respect to the end goal here. That’s pretty straightforward, and almost everyone is on board with that goal.

But, there are a dozen questions when it comes to the process. How exactly is GE going to do that? What businesses are going to be spun off? What businesses are going to be kept? How much can the businesses be sold for? What’s the underlying cash flow generation potential of “new GE”? What will the balance sheet look like in 12 months? What will earnings look like in 12 months? 24 months? 36 months?

Bottom Line on GE Stock

The reality is that no one knows the exact answers to all these questions, and because of that, the GE narrative is characterized as having far more questions than answers. That leads to a significant lack of clarity with respect to long term growth potential, and that in turn creates downward pressure on the stock.

As such, so long as the underlying narrative lacks clarity, GE stock will have trouble getting back into turnaround mode.

It increasingly appears that the best of the GE turnaround has already come and gone, and that a lack of clarity and catalysts will put continued downward pressure on GE stock for the foreseeable future.

As of this writing, Luke Lango did not hold a position in any of the aforementioned securities.