GM Becomes a Business Story Again
NEW YORK (TheStreet) -- When General Motors
The assumption is proving to be wrong.
GM is once more striding the globe, winning in some places, losing in other places, but generally moving forward on behalf of shareholders.
The company is still trailing Toyota
GM is also stepping up in other markets. It is pushing Chevys in China alongside a state-owned partner, SAIC Motor, and GM says the two partners are considering opportunities in Indonesia. GM is talking about developing Opel cars for the 2018 model year in Europe on its own, as its alliance with PSA Peuguot Citroë:n of France frays.
Not all of the news is good. Majority-owned General Motors India is facing a huge fine over alleged corporate fraud involving emissions testing going back to 2005. Vehicles have been recalled and some employees fired.
But in general, as the company prepares to announce earnings this week, indications are positive again. Analysts are expecting earnings of 94 cents a share for the quarter ending in September. The June numbers were $39.08 billion in sales and diluted normalized earnings of 83 cents a share.
Of the 19 analysts now following the stock, 16 have it listed as a buy or overweight, because GM has beaten estimates by 10% in the last two quarters, making its price-to-earnings ratio of nearly 13 look cheap.
GM shares are up more than 23% so far this year. That's less than the 35% gain by Ford
After three years on the job, CEO Daniel Akerson is now being asked for his "leadership lessons," and reporters are not being ironic. Akerson came from the Carlyle Group to GM in July 2009 as part of the buyout, and his income will be limited until the government sells the last of its stake, possibly by April.