Goldman cuts General Motors, shares down
|
|
|
(Reuters) - Goldman Sachs downgraded General Motors Corp to "sell" from "neutral," and added the stock to its "Americas Sell List," saying the main risks for the automaker included likely equity dilution, dividend cut and cash burn.GM shares, which have lost 47 percent of their value since the start of the year, were down nearly 8 percent at $11.81 before the bell on Thursday.Analyst Patrick Archambault, who also cut his ratings on Lear and Tenneco, said he expects GM shares to continue to underperform as market fundamentals deteriorate which exacerbates liquidity concerns.He cut his 6-month price target on GM stock by $8 to $11."We think GM's automotive cash flow burn this year and next is likely to lead it to look to raise capital, which we believe could lead to significant shareholder dilution and/or a cut to the company's dividend," Archambault said.He downgraded auto parts maker Lear Corp to "sell" from "neutral," citing its large exposure to Big Three trucks, referring to General Motors Corp , Ford Motor Co and Chrysler LLC , and rising raw material costs.The analyst slashed his 6-month price target on Lear stock by $12 to $16. Lear shares closed at $18.12 Wednesday on the New York Stock Exchange.Archambault also cut his rating on Tenneco Inc to "neutral" from "buy," and price target to $18 from $29. He removed the stock from the "Americas Buy List."Tenneco's shares are expected to remain under pressure as the company is likely to post weak second-quarter results, he said. However, the analyst believes this would be a better buying opportunity as he sees the company as a core long-term holding with strong earnings and growth prospects.He also cut his price target on "neutral"-rated Ford Motor Co to $5 from $8. Ford shares were down almost 4 percent at $5.04 in early trade.(Reporting by Eric Yep and Dilipp S. Nag in Bangalore; Editing by Himani Sarkar)
(c) Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.
|
|
|
|
|
|
Related News
Five more US bank failures bring total for 2009 to 120
New York - Bank failures in the United States have risen to 120 this year as five more regional institutions were added to the list, the US agency that guarantees the safety of bank deposits said. United Commercial Bank in San Francisco with assets o...
US stocks climb slightly despite double-digit jobless rate
New York - US stocks posted mild gains Friday to end the week as investors shrugged off government figures that put the unemployment rate above 10 per cent. The Labour Department said the jobless rate hit 10.2 per cent in the month of October, the hi...
US joblessness hits 10.2 per cent, highest in 26 years - Summary
Washington - The US unemployment rate surged to 10.2 per cent in October, the highest in 26 years as another 190,000 people lost their jobs, the Labour Department reported Friday. The figure comes after a 9.8-per-cent jobless rate in September and wa...
US joblessness jumps to 10.2 per cent, highest since 1983 - Update
Washington - The US unemployment rate surged to 10.2 per cent in October, the highest in 26 years, as another 190,000 people lost their jobs during the month, the US reported Friday. The figure reported by US Labour Department came after the 9.8 per ...
US jobless rate jumps to 10.2 per cent
Washington - The US unemployment rate surged to 10.2 per cent in October as another 190,000 people lost their jobs, according to US Labour Department figures released Friday. The jobless rate stood at 9.8 per cent in September. Unemployment had been ...
Bulls stop James, edge Cavs - Summary
Los Angeles - The King couldn't deliver in the clutch. Luol Deng and Joakim Noah combined to deny LeBron James a potential game-winning drive in the final seconds as and the visiting Chicago Bulls snapped the Cleveland Cavaliers' three-game winning...
Mortgage lender Fannie Mae posts nearly 19-billion-dollar loss
Washington - US mortgage lender Fannie Mae said Thursday that it would seek 15 billion dollars in federal aid, after posting its ninth consecutive quarterly loss. Fannie Mae reported a net loss of 18.9 billion dollars in the third quarter of 2009, co...
|
|
|
|
|
|
|
|
