GM worth

[BlueBee]

Since y’all are part owners of the General Motors Company, how much do you think it is worth these days?   Stock market says its worth 32 billion based on the closing share price last week of $20.  That is about 1/2 what it was worth last year (share price was up to $40 last year).  It’s lost 50% of its value this year.  Yikes!

Can it drop forever or is there some level at which GM stock would be a bargain to buy?  They have been making large profits lately (4.7B in 2010, probably 8B+ in 2011), car sales are going up, and they’re the market leader in the USA and China.  On the downside the government has a boat load of (tax payer) shares (500 million shares) they want to unload before the election, they’re losing money in Europe, a couple Volts caught on fire, and the price of oil is likely headed back into the pain zone again.

Buy, Sell, or Hold? 

[iddee]

From the looks of the chart, I would say sell or daytrade. Daytrading and selling short for short periods is the only way I see to make money with GM.

At this time, energy stocks are rising fast and paying good dividends. Most my profit for the last 2 years has been with them.

[BlueBee]

I agree with you iddee, energy stocks are probably a good place to be unless they’ve got too much exposure to Natural Gas.  Natural Gas is about the only thing that has fallen faster than GM!  It will be interesting to see which hits rock bottom first.

I would speculate a lot of big boys on Wall Street have been short GM from day 1 and are making a killing at this point.  Up 50% on their shorts in a year!  That’s a LOT better than being long on the overall market this past year.  At some point they have to cover those shorts (and buy shares).  Maybe a bottom is about due?  Then again GM did for all the way down to $0.00 just a couple years ago! 

[rgy]

a very wise and very wealthy investor once said he NEVER buys auto companies, auto suppliers, or airlines!!  the three A's as he called them.

[AllenF]

Look at what these large companies will have to pay out over the next 20 years in insurance and retirement cost to current and retired employees.   That cuts into profits that they can give back to the stock holder.   Why buy into a company that will not make you need for what you paid for it.
Also, with the way the Federal gov is going, tax corporations to death, just another reason not to pay for those stocks.