Tuesday November 11, 2008

GM share price target cut to zero by Deutsche Bank

This article belongs to the GM, Ford and Chrysler bankruptcy watch story arc.

bloomberg.com :

General Motors was downgraded to "sell" at Deutsche Bank, which set a share-price estimate of zero, and was cut to "underweight" at Barclays Capital. The biggest US automaker said Nov. 8 it may not have enough cash to keep operating this year unless the auto market improves or it adds capital. "Even if GM succeeds in averting a bankruptcy, we believe that the company's future path is likely to be bankruptcy-like," Deutsche Bank analyst Rod Lache wrote in a research note.

- Zero would be too kind. How about negative? Looking at prior figures from Google Finance, with GM's outstanding shares of 566.16 million, total shareholder equity of -$56.97 million, the target share price is more like -$0.10. And these are figures from Jun 2008, so it should be much worse by now.

Now I'm watching yet another big-company share collapse in real-time, to become a much smaller company, market-cap-wise. The previous one was Las Vegas Sands. Not with a bang but with a whimper, as formerly big blue chips go quietly into the night. Economic collapse in progress.

See also :

1. GM, Ford, Chrysler face bankruptcy risk on crisis : S&P
2. GM bankruptcy possible: S&P
3. GM to cut 25000 jobs in U.S. by 2008
4. GM's ratings cut deeper into junk territory
5. GM risks bankruptcy as it runs out of cash, losing $73 billion since 2004, suspends Chrysler merger

(2008-11-11 00:06:44 SGT) [Biz] Permalink

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