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Shares of General Electric (GE - Free Report) slumped as much as 3% in morning trading Monday after the company approved the appointment of an activist shareholder to its board of directors.

Just days after naming a new CFO and announcing the departure of three vice chairs, General Electric announced this morning that Trian Fund founding partner Ed Garden has joined its board. Trian currently owns about 1% of GE and has been pressuring management to make changes.

“I am disappointed by the recent performance of GE's stock. But I continue to believe that GE represents an attractive long-term investment opportunity with significant upside,” said Garden.

Garden’s appointment and the recent executive departures underscore the severity of the changes being made at GE right now. New CEO John Flannery is forging a significant makeover for the 125-year old company, and investors are still unsure about what could be coming next.

After years of underperformance, Flannery is looking to cut costs and make key portfolio changes. There’s already been speculation that earnings expectations and dividends could be cut soon. And the recent management shakeup shows that leadership will look significantly different.

Change is almost certainly what the Dow Jones Industrial Average’s worst performing stock of 2017 needs, but investors have showed an appetite for caution as this transition continues to play out.

“GE could end up in better place once the dust settles but investors should steer clear until we learn more. That better place could be with a starting point much lower for the stock price,” said Vertical Research analyst Jeff Sprague in a recent note.

For now, GE will need to get used to its lifestyle change. Flannery has reportedly cut corporate jet services and company cars in an effort to slash $2 billion in costs through 2018, and the latest leadership changes include some of the company’s most well-known executives.

Departing CFO Jeff Bornstein, for example, has been with General Electric since 1989 and was widely regarded as the practical partner to longtime CEO Jeff Immelt’s big picture direction. GE said that Bornstein would work closely with Flannery, but many investors saw Bornstein as the favorite to succeed Immelt in the first place.

More specific details about Flannery’s vision will be revealed at a meeting scheduled for November 13. Until then, investors can expect speculation to run rampant and near-term volatility to continue. GE is currently a Zacks Rank #4 (Sell).

Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

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