GM stock takes 24% hit after analyst report

[jamz]

Filed under: GM, Earnings/Financials


With General Motors dropping its $2.5 billion bomb on Friday, analysts, brokers and the public at large were waiting until today to see where the General's stock price would end up. At the end of the day, it's hovering around $3.36 a share, up from this morning where it hit $3.04, or four pennies away from its lowest rate in over 60 years. The plunge is hardly a surprise as analysts -- and GM -- admit that without a Federally-funded cash injection the automaker would run of working capital early next year, or worse, before the end of 2008. Throwing salt into the wound is Deutsche Bank, which reduced GM's rating to "sell" with a price target of $0.00.

In addition to the $25 billion in loans that Congress has already approved, Detroit's Big 2.8 have asked for another $25 billion, and House Speaker Nancy Pelosi shot off a letter to Treasury Secretary Henry Paulson trying to get the $700 billion bailout to the financial industry to include the U.S.' ailing automakers. Who knows what kind of stipulations would be attached if such an agreement would take place, but the wholesale removal of GM's board would be a good start.

[Sources: Automotive News - Sub. Req., Detroit News]GM stock takes 24% hit after analyst report originally appeared on Autoblog on Mon, 10 Nov 2008 19:01:00 EST. Please see our terms for use of feeds.


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