Time to Buy? Investment Firm Advises Clients to Sell GM Stock

[Ming]

Time to divest General Motors stock?
by Andy Hoag | The Saginaw News

When Timothy M. Riley sold the shares of General Motors that he held for 30 years, he didn't think the price of the stock could dip any lower.

That was more than a year ago.

"Once I retired, I hired a financial planner, and he suggested selling the stock," says Riley, who serves as his township's treasurer. "I would have rather not have had to do it. There was a time when it was real good, up to $70 or $80 a share."

Faced with soaring gasoline prices, showrooms full of fuel-thirsty trucks and a sputtering economy, GM shares slid to a 54-year low last week before rising 66 cents to close at $10.78 in trading Tuesday.

As recently as late January, the stock cost $28 to $30 per share.

The company could lose $6.9 billion this year and $4.3 billion in 2009 before swinging a $2.3 billion profit in 2010, according to JPMorgan Chase & Co. auto analysts.

A predicted rebound isn't enough to encourage buying shares, says Steve Anderson, branch manager at Hilliard Lyons, 4835 Towne Center.

"The keyword is maybe," he says. "You generally want to see a little bit of firm data. At this point, (the prediction) is based on certain suppositions that we don't know how will play out."

And although the stock just hit a low doesn't mean the "buy low, sell high" theory will work, Anderson says.

"Sometimes stocks continue to go down," he says. "People thought Ford was a good buy when it was at $10 a share."

Tuesday, it closed at $4.90 a share.

Edward Jones Investments, which has five locations in Saginaw and Saginaw Township, recently stopped providing opinions on General Motors, officials say. Before the decision, investors at the firm advised clients to sell GM stock.

http://www.mlive.com/businessreview/...al_motors.html

[cincygoblue]

Seriously, when do you ever hear an analyst say, "Well, the stock is at its 52 week high, and has been going up consistently for the past year and a half. Time to sell." They often guess at lows, looking for a stock to rebound, but just as often you get this kind of thing. "Stock is low. Sell." Where was the analysis at $20-30 that set a price target of $9?

How do you get a job as an analyst, and what does it take to lose your job?

[wescoent]

Time to buy?

I would be extremely hesistant to put any money into a long GM position right now, given the level of uncertainty. I wouldn't want to be sitting on a big pile of worthless GM common stock in the event of bankruptcy.

[377Z]

The old me is tempted to buy a little for fun.

The new me is afraid it may get cancelled.

[wescoent]

Originally Posted by cincygoblue

Seriously, when do you ever hear an analyst say, "Well, the stock is at its 52 week high, and has been going up consistently for the past year and a half. Time to sell." They often guess at lows, looking for a stock to rebound, but just as often you get this kind of thing. "Stock is low. Sell." Where was the analysis at $20-30 that set a price target of $9?

How do you get a job as an analyst, and what does it take to lose your job?

Go to school at a top university, get top grades, pass 5 rounds of interviews, be willing to work 100 hours a week, and accept abuse by your VP and MD that would violate the Geneva Conventions.

Analysts don't get fired. You get a 3 year contract as an analyst, get your MBA, and get hired back as an associate.

Memories...

[neshapop]

Originally Posted by wescoent

Go to school at a top university, get top grades, pass 5 rounds of interviews, be willing to work 100 hours a week, and accept abuse by your VP and MD that would violate the Geneva Conventions.

Analysts don't get fired. You get a 3 year contract as an analyst, get your MBA, and get hired back as an associate.

Memories...

You just made me cry, poor thing. How about a shot in engineering branch?
All that minus the money and social and corporate respect.
P.S. And abuse from business spin masters how to do your job.

[wescoent]

Originally Posted by neshapop

You just made me cry, poor thing. How about a shot in engineering branch?
All that minus the money and social and corporate respect.

Well, yeah... there's a REASON why I didn't go into engineering. Though, I would only argue that the advantage we have is monetary in nature. Analysts get zero social OR corporate respect. In society, they're money-grubbing fat cat bankers, and in the bank, they're considered lower than dirt.

I try to treat my analysts with some semblance of mercy...

[377Z]

Originally Posted by wescoent

Well, yeah... there's a REASON why I didn't go into engineering. Though, I would only argue that the advantage we have is monetary in nature. Analysts get zero social OR corporate respect. In society, they're money-grubbing fat cat bankers, and in the bank, they're considered lower than dirt.

I try to treat my analysts with some semblance of mercy...

I wish I would have been aware of that 15 years ago...

...I've kicked around the idea of getting a math teaching degree. 3 year program, math teachers are in demand, its easier, you get summers off. And, my earnings could catch up in 5 years or less & are certain to eclipse anything I will get if I stay an engineer, & I say that being a reasonable distance up the totem pole. I can only imagine where I'd be now if I had known and gone that path back when I was in school.

Where I work, the spouse of EVERY engineer earns more, all with less education. Engineering is so broad that in many cases jumping to other industries is tough unless you are willing to start at the bottom, which is hard after trying to stick it out at one company for 10 years.

It makes me want to get into my little 10 year old Civic and driving myself to the bar...

[delmarjohn]

some ANALYST know what they are talking about,but on the whole most don't have a clue.....you are given X number of companies to monitor,gather info,get sources and most couldn't forecast any better than a local forecaster in real time

[PeteM143]

Originally Posted by wescoent

Go to school at a top university, get top grades, pass 5 rounds of interviews, be willing to work 100 hours a week, and accept abuse by your VP and MD that would violate the Geneva Conventions.

Analysts don't get fired. You get a 3 year contract as an analyst, get your MBA, and get hired back as an associate.

Memories...

Being a person with an MBA, I've had that experience too...Tell us you'll sell your mother's soul to the devil and you're in..
That's precisely why I left the financial services business this year.

[delmarjohn]

in regard to engineering ....do some research on the apollo program give good engineers a goal,don't fire them because wall street says cut costs and make sure they are team player ....WITH A GOAL ....and they should exceed yours or anyones expectations ....wall street is into daily knee jerk reactions ...when in fact most businesses should operate on 2-5-10 year plans...and yes with most of the same players....nothing like being part of a team with a goal.....but then again it is up to management to set the right goals

[delmarjohn]

I left the insurance business many years ago ,because I wondered how some of the people in that industry could sleep at night

[wescoent]

Originally Posted by delmarjohn

I left the insurance business many years ago ,because I wondered how some of the people in that industry could sleep at night

Heh... it's funny that you think we actually sleep at night... that's when we put on the cloaks and have our conspiricy meetings with the Rockefellers and Rothschilds, and plot how to destry the middle class.

[Ambalanche]

I'm actually surprised they are saying sell now when they know most people who own GM stock paid a whole lot more for it. It can't go too much lower without being worthless so I would just hold it and wait for 2010 when they "could swing to a 2.3 billion dollar profit."

[prototype66]

My faith in humanity just dropped down two notches.