Morgan Stanley Makes GM (GM) Top Automotive Pick for 'Fortress' Balance Sheet
Tweet Send to a Friend
Get Alerts GM Hot Sheet
Price: $32.92 -0.93%
Rating Summary:
20 Buy, 4 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 19 | Down: 21 | New: 29
Rating Summary:
20 Buy, 4 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 19 | Down: 21 | New: 29
Trade GM Now!
General Motors (NYSE: GM) shares are trading slightly positive Wednesday morning amid positive comments by Morgan Stanley.
Morgan Stanley put GM atop it's automotive stock rankings due to its "fortress balance sheet," and ability to weather the storm for years to come should the U.S. enter another recession. GM currently has about $33.8 billion of cash on the balance sheet.
Conversely, peer Ford Motor (NYSE: F) has only about $8 billion of net cash, and Morgan Stanley believes Ford might have more debt than cash within 18 to 24 months should the U.S. environment worsen.
Morgan Stanley cut its price target on GM from $50 to $45 and its fiscal 2011 unit sales outlook from 13 million to 12.6 million. Morgan Stanley sees growth over the next two years, with sales of 14 million in 2012 and 15 million in 2013.
Despite the bullish outlook, Morgan Stanley reminds investors annual sales regularly topped 16 million units before the recent recession.
Elsewhere in the Auto sector, suppliers which Morgan Stanley believes are most likely to succeed should the economy turn sour again include BorgWarner (NYSE: BWA) and Johnson Controls (NYSE: JCI).
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
Morgan Stanley put GM atop it's automotive stock rankings due to its "fortress balance sheet," and ability to weather the storm for years to come should the U.S. enter another recession. GM currently has about $33.8 billion of cash on the balance sheet.
Conversely, peer Ford Motor (NYSE: F) has only about $8 billion of net cash, and Morgan Stanley believes Ford might have more debt than cash within 18 to 24 months should the U.S. environment worsen.
Morgan Stanley cut its price target on GM from $50 to $45 and its fiscal 2011 unit sales outlook from 13 million to 12.6 million. Morgan Stanley sees growth over the next two years, with sales of 14 million in 2012 and 15 million in 2013.
Despite the bullish outlook, Morgan Stanley reminds investors annual sales regularly topped 16 million units before the recent recession.
Elsewhere in the Auto sector, suppliers which Morgan Stanley believes are most likely to succeed should the economy turn sour again include BorgWarner (NYSE: BWA) and Johnson Controls (NYSE: JCI).
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
You May Also Be Interested In
- Hewlett-Packard (HPQ) Q2 Performance Wins Praise on Wall Street; Jefferies Raises to Hold
- Workday (WDAY) Success Continues but Valuation Lofty, Goldman Maintains Neutral
- Jefferies Bumps PT on Home Depot (HD) to $91
Create E-mail Alert Related Categories
Analyst CommentsRelated Entities
Morgan Stanley
Login with Facebook
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
