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Buffett, Soros Sell GM Shares – But JPMorgan Bank Calls Maker’s Stock “Very Inexpensive”

by on May.16, 2014

GM's stock price has bouced a bit but largely been stuck in neutral over the past three months as the maker copes with its recall crisis.

Investors generally don’t like turmoil or uncertainty – something in abundant supply at General Motors these days, which may explain why the makers share price has been performing so poorly.

Yet even after expressing high hopes for the maker’s new CEO Mary Barra, mega-investor Warren Buffett has sold off a quarter of the GM shares held by his investment firm, Berkshire Hathaway. And he’s not alone. Other major investors, including George Soros’ Soros Fund Management, and David Einhorn’s Greenlight Capital, have abandoned the maker in recent months, selling part or all of their holdings.

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Yet even while cautioning that GM will be taking an earnings hit for its latest series of recalls – six separate service actions covering nearly 3 million vehicles announced this week alone – influential JPMorgan’s auto analyst may have sent the sort of positive signal other investors are looking for.

“We note the recalls are very proactive in nature,” Brinkman wrote in a report to investors. “We see GM stock as very inexpensive.”

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Buffett Boosts GM Holdings by 60%

Legendary investor rushes in as Treasury continues stock sell-off.

by on Aug.16, 2013

Warren Buffett just increased his GM stock holdings by 60% to 40 million shares.

Even as – and perhaps because of – the U.S. Treasury continues selling down its remaining stake in General Motors, billionaire investment guru Warren Buffett is rapidly increasing his own holdings in General Motors.

According to a federal filing, Buffett’s investment arm Berkshire Hathaway has increased its holdings in the giant Detroit maker by 60%. He now has 40 million shares, or 2.9% of GM’s outstanding stock.

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That news came just days after Treasury officials advised Congress they has sold off around 25 million more shares in GM for a total sale of $876.9 million. The federal government now holds just 136 million shares, a little more than a quarter of the 500-million-share stake it gained after the maker’s 2009 bankruptcy, in return for a $49.5 billion bailout. (more…)

Treasury Rushing to Sell Off More GM Stock

Maker’s shares gets a bump as it prepares to rejoin S&P 500.

by on Jun.05, 2013

GM stock is showing strong momentum after being in the doldrums most of 2012.

While the Treasury Department’s self-imposed deadline to dump its remaining General Motors stock is still nearly a year away, the government plans to benefit from rising prices by putting another 30 million shares on the block this month.

The announcement comes a day after word came that General Motors will rejoin the closely watched S&P 500 stock index for the first time since it filed for bankruptcy in 2009. The maker’s shares have been surging in recent weeks and are now trading above GM’s November 2010 IPO price of $33 a share.

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The government isn’t alone in seizing a potential opportunity. Another 20 million GM shares will be sold by the UAW Retiree Medical Benefits Trust. Commonly known as a VEBA, it received stock in the wake of the maker’s 2009 bankruptcy.

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GM Rejoining S&P 500

Strong sales, earnings buoy domestic auto stocks.

by on Jun.04, 2013

Investors have been buoyed by strong sales of GM's big trucks - the 2014 version of the Chevrolet Silverado shown here.

Barely four years after emerging from a bankruptcy some thought it might not survive, General Motors is once again being seen as a barometer of the American economy, the maker rejoining the S&P 500, a key stock market index, after the New York Stock Exchange wraps up Thursday trading.

GM will replace H.J. Heinz Co. on the S&P 500, according to the S&P Dow Jones Indices. It comes as the latest in a series of endorsements for the Detroit maker, including recent debt ratings upgrades, and follows a series of strong earnings reports and U.S. sales gains.

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The move is expected to help further boost the share price of GM which has already experienced a more than 25% gain since early April. But it’s by no means alone.  Cross-town rival Ford Motor Co. has jumped by an even greater margin in recent months, as has Fiat S.p.A., the Italian automaker that now owns a controlling stake in Detroit-based Chrysler Group LLC.

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How High is Up for GM Stock?

Maker will rejoin S&P 500 “before too long,” says CEO Akerson.

by on May.20, 2013

GM CEO Dan Akerson delivers the commencement address to Notre Dam business grads over the weekend.

Perhaps it’s just a rising tide lifting all boats, but General Motors stock has hit its highest close in more than two years – beating the $33 a share price tag set during its initial public offering in November 2010.

The resurgence comes as the overall stock market charges from one record to another, but also suggests that investors are impressed by the performance of the giant maker which earlier this month announced $865 million in earnings for the first quarter of 2013.

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Though it has now delivered 3 consecutive quarterly profits, GM is still in the “early innings” of its recovery,” CEO Dan Akerson said over the weekend in South Bend, Indiana, where he delivered the commencement speech for Notre Dame business school graduates.  GM is “on the cusp,” said the executive, of regaining its investment grade debt rating back.  Akerson also suggested in his speech that the maker will rejoin the S&P 500 “before too long.”

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Atlas Concept Truck a Pick-Up for Ford Stock

Unexpected unveiling offers a hint of replacement for best-selling F-Series.

by on Jan.15, 2013

The surprise debut of the Ford Atlas concept pickup.

Ford Motor Co. stock took a sharp jump following the automaker’s unexpected unveiling of the Atlas Concept truck, a prototype offering a hint of what’s to come when the maker replaces its best-selling F-Series pickup in 2014.

In an appearance to an industry conference coinciding with the North American International Auto Show, Ford CEO Alan Mullaly marveled at the reaction to the preview.  The unveiling of the Atlas had been whispered about but unconfirmed by the maker until the huge silver truck descended from the ceiling of Detroit’s Joe Louis Arena.

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“How about that,” proclaimed Mulally in an off-the-cuff remark following  his speech to the Automotive News World Congress. By the time the NY Stock Exchange closed, Ford common was up 31 cents, or 2.22%, for the day, to $14.30.

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Akerson Hopes to Pull GM Out of “Junk” Status

CEO expects “modest” share increase in 2013.

by on Jan.09, 2013

GM Chairman Dan Akerson has high hopes for 2013.

With the U.S. Treasury getting set to sell off its remaining stake in General Motors over the next year, the Detroit maker is looking ahead to a time when it can not only regain its complete independence but also win over skeptical investors, analysts and consumers, GM CEO Dan Akerson said during a rare meeting with journalists.

Akerson said he is confident GM can achieve a “modest share increase” in the U.S. this year after a weak performance in 2012 that saw is share slip to an 80-year low of just 17.9%.  But he also admitted the situation in Europe, where GM has now operated in the red for 14 straight years, is still a challenge.

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One of the executive’s ongoing goals is driving up profitability which Akerson hopes, will also help prop up GM’s share price.  While the maker has made significant gains in recent months, its shares are still trading about 10% below the $33 strike price set during the November 2010 GM IPO.

The other challenge facing GM is digging its way out of “junk” territory, where its debt rating has lingered since 2005 – though in a positive sign, a recently negotiated line of credit was able to generate an investment grade raing.

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Fixing Europe a Top Priority, Says GM CEO

Maker has had no discussions with White House about selling government stake.

by on Jun.12, 2012

GM CEO Dan Akerson answers a question following the maker's 2012 annual meeting.

The unsettled economic climate in Europe has undermined General Motors’ efforts to revitalize the company’s operations, GM Chairman and Chief Executive Officer Dan Akerson said Tuesday.

Fixing GM’s operations in Europe remains the company’s top priority, added Akerson following the maker’s annual meeting.  He noted GM of Europe has succeeded in striking new labor agreements with unions in both Poland and Great Britain and is “talking with unions in Germany” about possible concessions that could prove critical to GME’s turnaround.

Analysts believe the maker would like to close at least two of the plants operated by its European Opel brand but taking such a drastic step would be difficult without union cooperation due to laws that generally limit plant closures and job cuts.  Meanwhile, speaking with reporters, Akerson said GM sees cost-cutting as just one step in the European turnaround effort.

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“Underscoring our commitment to Opel, we’re investing billions in new models like the Mokka, which is the first contender from a German manufacturer in the growing sub-compact SUV segment. We’re making this investment even as we address overcapacity and high fixed costs in the region,” Akerson noted.

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GM’s Stock Surges on Buffett Buy

“Oracle of Omaha” snags 10 million shares.

by on May.16, 2012

But will Warren Buffett now upgrade his old Cadillac DTS, too?

Analysts and investors alike will be watching the ticker closely today to see how the market responds to word that the “Oracle of Omaha” has grabbed 10 million shares of General Motors stock.

According to a filing with the Securities and Exchange Commission, Buffett’s investment firm Berkshire Hathaway will spend $256.6 million for the stock, a nearly 20% premium over their value of $214.2 million when trading on the New York Stock Exchange wrapped up on Tuesday.

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But that’s still well behind the $330 million Buffett would have invested during GM’s November 2010 IPO. And the question is whether this move signals the possible turnaround in GM shares which have been lagging like most automotive stocks in recent months.

The maker has staged a modest recovery from its $19-a-share 52-week-low, and GM stock surged by $1 as soon as the market opened Wednesday morning before settling back slightly.

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