General Motors
stock is down 45 percent over the last year, which would lead the uninformed to think that the automaker is still losing money by the bucketload. On the contrary, The General pulled in a healthy $7.6 billion in 2011.

Does that mother lode of cash make GM a buy for 2012? Capital research Global Investors seems to think so. The Detroit News reports that the investment firm has purchased 5.8 percent of the Detroit automaker. That's 92 million shares, which translates to about $2.3 billion at $25 per share.

The investment firm claims GM stock is a strong buy even though its European sales are lagging. David Kudla, CEO of Mainstay Capital Management LLC, points out that there are a lot of automakers selling vehicles in Europe, adding "everybody who does business there is struggling." The Capital Group also points to continued growth in the U.S. market due in part to pent-up demand as a reason for the big bet on GM stock.



I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 34 Comments
      billfrombuckhead
      • 2 Years Ago
      BBBBBBBBBBBBBBBBBuuuuuuuuuuttttttttttttttttttttttttttt all the pundits say GM is a bad bet??? PUNISH DEGENERATE SOUTHERN REPUBLICAN POLITICIANS AND VOTERS, BUY A UAW BUILT BIG 3 CAR!
      Diz
      • 2 Years Ago
      May they be to GM what Cerberus was to Chrysler - A clown-car filled with buffoons.
        Chase
        • 2 Years Ago
        @Diz
        Cerberus was a special case because it was an active investor. Most investors are passive. Also Cerberus had controlling interest (over 50% ownership).
        • 2 Years Ago
        @Diz
        [blocked]
      • 2 Years Ago
      [blocked]
        • 2 Years Ago
        [blocked]
      Avinash Machado
      • 2 Years Ago
      Things seem to be looking up for GM.
        • 2 Years Ago
        @Avinash Machado
        [blocked]
      fat kid
      • 2 Years Ago
      then sell the stake to someone to make money. question is, who will buy it?
        • 2 Years Ago
        @fat kid
        [blocked]
      2 Wheeled Menace
      • 2 Years Ago
      This is not good. I never see anything good come of companies that get bought up by investment firms. *cough*cerberus*cough*
        Nemebean
        • 2 Years Ago
        @2 Wheeled Menace
        As someone else pointed out, this is not remotely comparable to Cerberus. They're just investing, not buying outright.
      Nick
      • 2 Years Ago
      "mother lode".... oh gosh... please hire me as an assistant editor....
        Nick
        • 2 Years Ago
        @Nick
        it's mother load
          Danaon
          • 2 Years Ago
          @Nick
          Actually it's not, lode is a mining term.
          3waygeek
          • 2 Years Ago
          @Nick
          No, it's not. http://en.wikipedia.org/wiki/Mother_lode
          Nemebean
          • 2 Years Ago
          @Nick
          Impressive. With all of the grammatical faux pas that AB writers commit, you managed to find one they got right. :-)
          Chase
          • 2 Years Ago
          @Nick
          wha wha whaaa
          • 2 Years Ago
          @Nick
          [blocked]
        caddy-v
        • 2 Years Ago
        @Nick
        You'd never get your name right on the resume.
      Danaon
      • 2 Years Ago
      At the current price, GM is a steal. The reason it's this low to begin with is that people are wary of the treasury dumping its shares. When that happens it will lower the stock price.
        rlog100
        • 2 Years Ago
        @Danaon
        I'm concerned depend on who gets elected, they will rashly dump all the shares at once in a big show, causing the share price the plummet and losing the tax payers even more money.
      cc
      • 2 Years Ago
      The article states GM stock is down 45% this year, how do you come up with that figure? The stock traded at around $37 in February of 2011 and is now at $27.45. That is not a 45% decline.
        montoym
        • 2 Years Ago
        @cc
        AB certainly mucked up the wording, but the meaning was pretty clear to me. Though maybe it's because I recalled reading similar stories at the beginning of the year so the numbers made sense to me. Maybe should have been worded, "General Motors stock dropped 45 percent last year", the article isn't meant to state that the stock is down 45% from this time last year, it means that the stock was down 45% last year, meaning 2011. GM stock price close: Jan. 3, 2011 - $37.06 Dec. 30, 2011 - $20.27 37.06 - 20.27 = 16.79 16.79/37.06 = 45.3% The stock has made a decent gain so far this year and has closed the gap, but GM's stock did drop 45% last year.
      • 2 Years Ago
      [blocked]
      imoore
      • 2 Years Ago
      "The investment firm claims GM stock is a strong buy even though its European sales are lagging. David Kudla, CEO of Mainstay Capital Management LLC, points out that there are a lot of automakers selling vehicles in Europe, adding "everybody who does business there is struggling." That statement might be true, to a point. But I also think it may be due to Opel's lackluster product line. If they could only offer something exciting, like a new small sportster/roadster or even a version of Vauxhall's Aussie-built VXR sedan. Considering, of course, that Opel doesn't have a problem sourcing a product from Holden or HSV.
    • Load More Comments