* GE to focus on aviation, power, healthcare
* Cuts quarterly dividend to 12 cents per share from 24 cents
* Slashes 2018 profit outlook
* Shares down 2.7 pct premarket (Adds details from investor presentation, analyst comment)
Nov 13 (Reuters) - General Electric Co will focus on aviation, power and healthcare, radically shrinking the most famous U.S. conglomerate into a smaller company betting on industries where it has strong technology and a large customer base.
In a plan unveiled on Monday by new Chief Executive John Flannery, GE cut its dividend and profit outlook in half, sending its stock down 2.7 percent, as Wall Street worried about how the slimmed down company will generate cash to justify its valuation.
"By the numbers, we see a core operating performance that is below plan, and, currently, a consensus expectations curve that we think remains too high," said JPMorgan analyst Stephen Tusa said.
The stock is the worst performing Dow component this year, down 35 percent through Friday's close.
The refocusing of the company will likely mean a sweeping sale of $20 billion of assets, but GE did not detail exactly which parts of its business it plans to shed.
The dividend cut, only the third in the company's 125-year history and the first not in a broader financial crisis, is expected to save about $4 billion in cash annually.
GE forecast adjusted 2018 industrial free cash flow of $6 billion to $7 billion, up from an estimated $3 billion in 2017.
The move to make GE smaller and nimbler is a turnaround from the previous multi-business approach taken by former CEOs Jack Welch and Jeff Immelt.
Flannery's changes repudiate much of Immelt's vision of a "digital industrial" company that builds software to manage and optimize GE's jet engines, power plants, locomotives and other products.
Conglomerates are out of favor on Wall Street, where investors prefer to bet on specific industries rather than a mixed portfolio.
GE forecast 2018 adjusted earnings per share of $1 to $1.07 per share, compared with its earlier estimate of $2 per share. Wall Street was expecting $1.16, according to Thomson Reuters I/B/E/S.
The company on Monday cut its quarterly dividend to 12 cents per share from 24 cents starting in December.
GE's dividend cut - a bid to save cash when the company's cash flow is deteriorating - is the third in its history, the other two cuts came during the Great Depression and the global financial crisis of 2007-2009.
Flannery's strategy is a turning point for the company, which over several decades built itself into a sprawling conglomerate with interests across media, energy, banking, aviation, railroads, marine engines and chemicals.
GE executives have said that analysts have undervalued the company's digital business. They argue the digital units should be valued more like Amazon.com Inc, Alphabet Inc's Google and other fast-growing tech companies.
GE will also cut its board to 12 from 18 members.
(Reporting by Alwyn Scott in New York and Ankit Ajmera in Bengaluru; Writing by Sayantani Ghosh; Editing by Saumyadeb Chakrabarty and Bill Rigby)