Do you think GM stock is a good buy for the intrmediate and long term?
Additional Information:
This would definately be a gamble. If you look at GM's options chains you would see that a lot of people are doing just that.
Answers
546 points
warren answered 9 months ago …
Are you joking? They are bankrupt and will run out of cash this month. Good luck with that.
Warren
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348 points
Sensei answered 9 months ago …
GM is a stock for gamblers. If you think yourself a gambler, then consider the stock (at about $1.50) as a "perpetual call" with a "delta" of 1. If they go bankrupt, think of it as your call having expired worthless. If they recover (and I agree with Warren - that's a big "if"), you can ride the upside forever.
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106 points
traderdad37 answered 9 months ago …
I'll answer this more politely. No, please don't get lulled into it by the low price. It's not like a fundamentally sound company whose stock price has been pulled down with the broader markets. GM has been in trouble for years, nay decades, and never really fixed its problem. Now however, is the time of reckoning as it's weak business plan, non-existent balance sheet, and financial woes have been exacerbated by the recession. Look for GM to go into bankruptcy, wipe out investors, and rise again a much smaller company. If you must buy automaker stock look to Ford as your long shot (they've still got cash and actual profits from overseas operations) or Toyota. Yes, Toyota posted its first quarterly loss in living memory, but it's top dog in Japan, in Asia, South America, and one of the top sellers in the U.S.
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Sensei answered 9 months ago …
So, you've answered your own question ... "This would definitely be a gamble." Personally, I'd prefer a Blackjack Table. At least I have an idea of the odds in my favour ... I get entertained along the way ... a better chance of winning ... free drinks ... "comps" if I play long enough. Oh yeah ... and "eye candy" (good looking women.)
Hey, I've been wrong before but for me, I wouldn't touch GM with a 10 foot pole (or two 5 foot Romanians. LOL)
102 points
Soren answered 8 months ago …
If the unions lower the wages and adjust the costs to Toyota/Honda level or not more than 105% then GM is a posibility, but it probably needs 2 mondays in a week before it happens - so buy short.
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203 points
Future1investor answered 8 months ago …
GM is hard to talk about, from the standpoint of how many people are employed and how many Mom 'n Pop shops that depend on it. Nevertheless, GM is bleeding cash like AIG did in late 2008.
You must then ask yourself: Would you or your neighbor buy a GM car for $40,000 that only goes 40 miles? GM insists that most Americans only drive 20 miles per day. In the town I live, you go where the jobs are which means driving between 20 and 60 miles to work over the highway. Then there is the transportation of your children to their practices. So would you buy a GM car for $40 grand with this problem? Even if it were only $20,000 I bet most people wouldn't. At $40,000 GM says it is loosing money. So what the hell is GM doing????
They had a wonderful car in the mid-1990's that did over 100 mpg equivalent and it was very fast too! It was called the EV1 and ran with the battery technology of the time! These new Volt batteries are not only heavy but very very costly. A lot of energy will be expended just pushing or pulling around those batteries let alone passengers. Does this sound like a product that will put it back into the running?
You have to ask yourself...in this market, why did they design and plan the introduction of the new Camero? A tuff muscle car which can only get 26 miles per gallon? At a time when individuals and families are looking for every possible way to save money and increase efficiencies, this seems like only a play-car for the rich who don't need to worry about saving money on gasoline.
So...NO. General Motors is not a good buy for any reason other than to throw your money away. You will have a much more exciting time at the Casino than on this stock for your money. With some of these CEO's only paying themselves $1 to look good in the public eye, I bet most of them aren't even bothering to go to work these days. You'll probably find themselves drinking away the day out at the country club. What a way to run a business and take care of your employees!
