GM Stock is dropping like a ROCK
07-03-2008 | 07:41 AM
#46
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Joined: Aug 2001
Posts: 2,405
From: Michigan's left coast
Presumably, this didn't help GM's stock price performance yesterday:
Merrill: GM Needs $15 Billion, Bankruptcy 'Not Impossible'
Merrill: GM Needs $15 Billion, Bankruptcy 'Not Impossible'
NEW YORK -(Dow Jones)- General Motors Corp. (GM) is burning through cash faster than investors realize and may even face bankruptcy if the auto market worsens and it can't raise enough capital, Merrill Lynch warned Wednesday.
Merrill downgraded GM to underperform from buy and said that shares may fall below $7 over the next 12 months. GM shares fell 4.5% in recent trading to $ 11.22, the lowest its been in more than 30 years. A GM spokeswoman declined to comment on Merrill's report.
"Bankruptcy is not impossible if the market continues to deteriorate and significant incremental capital is not raised," the Merrill analysts wrote, while also deepening their expectations for GM's losses this year and projecting the automaker will report a loss next year as well.
Merrill believes GM will need to raise $15 billion in capital to fund its operations for the next two years - more than the between $5 billion and $10 billion analysts had previously forecast. The capital raise would come partly from existing credit facilities, with the remainder through a combination of secured debt, asset sales or even by effectively borrowing from the United Auto Worker's independent trust created to fund retiree health care, the Merrill analysts said.
Merrill downgraded GM to underperform from buy and said that shares may fall below $7 over the next 12 months. GM shares fell 4.5% in recent trading to $ 11.22, the lowest its been in more than 30 years. A GM spokeswoman declined to comment on Merrill's report.
"Bankruptcy is not impossible if the market continues to deteriorate and significant incremental capital is not raised," the Merrill analysts wrote, while also deepening their expectations for GM's losses this year and projecting the automaker will report a loss next year as well.
Merrill believes GM will need to raise $15 billion in capital to fund its operations for the next two years - more than the between $5 billion and $10 billion analysts had previously forecast. The capital raise would come partly from existing credit facilities, with the remainder through a combination of secured debt, asset sales or even by effectively borrowing from the United Auto Worker's independent trust created to fund retiree health care, the Merrill analysts said.
07-03-2008 | 09:06 AM
#48
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Joined: Mar 2004
Posts: 3,577
From: Sandy VJJville
I just wonder how much of this doom and gloom reporting is making things worse for GM. I mean there's the story in the lounge about speculation, bad news, and rumors putting the nails in the coffin of Bears & Stern. We've seen what bad news and speculation can do to the price of oil. I just can't help but think that sending out all of these articles about how bad things are at GM is just throwing fuel on the fire.
07-03-2008 | 10:59 AM
#49
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Joined: Aug 2001
Posts: 2,405
From: Michigan's left coast
Anyone can make sh*t up - GM's problem is that it doesn't have the fundamentals or the PR capabilities to refute any of this stuff. If the facts aren't in your favor, and if you're incapable of generating positive spin, the future doesn't look so bright.
07-03-2008 | 11:58 AM
#50
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Joined: Nov 2006
Posts: 976
From: SE MI
The Detroit News reports today that the Merrill Lynch analyst, John Murphy, in a note to investors, said he expects GM stock to fall to $7 and believes there is potential downside in the stock below $7. He forecasts significant losses for GM this year and next and that bankruptcy is not impossible if the market continues to deteriorate. This is significant because "The Merrill Lynch analyst was one of the last tepid bulls on GM," said David Sowerby, senior portfolio manager at Loomis, Sayles & Co. LP investment management in Bloomfield Hills [MI]. "He was the last guy defending the bunker."
By Christine Tierney and Brian J. O'Conner
By Christine Tierney and Brian J. O'Conner
Last edited by GTOJack; 07-03-2008 at 12:13 PM.
07-03-2008 | 10:33 PM
#51
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Joined: Jun 2008
Posts: 107
Anyone can make sh*t up - GM's problem is that it doesn't have the fundamentals or the PR capabilities to refute any of this stuff. If the facts aren't in your favor, and if you're incapable of generating positive spin, the future doesn't look so bright.
Whos making this up????
GM came out a month ago and said that they will not make any money in 2009.
I would not buy any of GM stock since the company looks very gloomy.
Maybe its good a few companys go out of business?
It will make a better ecomomy in the near future with one less company.
I try to stay away from Auto and airline stocks,,,Buy Visa,JPM,BAC,WFC since they are there for our pickings.....
Whos making this up????
GM came out a month ago and said that they will not make any money in 2009.
I would not buy any of GM stock since the company looks very gloomy.
Maybe its good a few companys go out of business?
It will make a better ecomomy in the near future with one less company.
I try to stay away from Auto and airline stocks,,,Buy Visa,JPM,BAC,WFC since they are there for our pickings.....
07-03-2008 | 11:55 PM
#52
Registered User
Joined: Jun 2004
Posts: 2,977
From: SeVa
GM go out of business... no thanks, IIRC that would bump unemployment in the US by 10% as it rippled across the economy.
Not to mention the inevitable incarceration I would face for beating some pimple faced ricer to death for gloating about it.
Not to mention the inevitable incarceration I would face for beating some pimple faced ricer to death for gloating about it.
07-04-2008 | 12:00 AM
#53
Registered User
Joined: Aug 2001
Posts: 2,405
From: Michigan's left coast
I would not buy any of GM stock since the company looks very gloomy.
Maybe its good a few companys go out of business?
It will make a better ecomomy in the near future with one less company.
Maybe its good a few companys go out of business?
It will make a better ecomomy in the near future with one less company.
07-04-2008 | 11:09 AM
#55
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Joined: Oct 2000
Posts: 2,402
From: Toronto, ON Canada
07-04-2008 | 12:55 PM
#56
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Joined: Apr 2000
Posts: 2,224
From: CNY
Tax the living snot out of every foreign good in this country, whether it's "assembled" here or somewhere else.
When is this country going to start taking care of itself?
07-04-2008 | 01:36 PM
#57
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Joined: Oct 2000
Posts: 2,402
From: Toronto, ON Canada
With your country's debt at the level that it is now, it cannot afford to tax the snot out of every foreign good.
07-04-2008 | 03:05 PM
#58
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Joined: Aug 2001
Posts: 2,405
From: Michigan's left coast
