Friday, September 23, 2011

S&P re-affirms positive out look on new GM shares

 Investors shouldn't avoid General Motors Stock because of the weak economy, according to Standard & Poors. "With increases in U.S. and global economic concerns and pressures, we cut our (earnings per share)  forecast and target price. While we still see higher sales and profits, we see risk to volume growth rates and margins in various key markets. We lower our '11 EPS estimate 23 cent  to $4.43 and '12's by 56  cents to $4.58. Based on peer and historical P/E analysis, we reduce our target price by $6 to $34. Still, we see GM poised to take advantage of rising global vehicle demand. We project free cash flow in excess of $15B for '11 and '12 combined, and view GM's stock valuation as compelling," Efraim Levy, the Auto manufacturers & Parts Analyst for Standard & Poor's Equity Research said in a new note to investors. By Joseph Szczesny


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