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GM Shares Rise

GM stocks are upgraded

auto warrantiesOn Wednesday, General Motors Corp. shares jumped. The shares jumped because an analyst upgraded GM’s stock to “buy” status. That’s where a company wants to be. GM’s restructuring model looks as though it is working. The restructuring of most companies is usually laying people off and GM is no different. GM will reduce its workforce by 30,000 by the end of 2008.

After the analyst announced the “buy” status, GM’s stocks rose $1.86 or 7.6% to $26.34 per share. Merrill Lynch’s John Murphy announced that the capacity reduction plan will boost shares by about $4 in the future.

Murphy more than doubled his 2007 earnings estimate to $4.10 from $1.90 and increased his 2008 estimate to $5.25 from $3.15. The increase also accounts for an adjustment for the portion of earnings from GM’s financial arm, which will be sold in late 2006/early 2007, Murphy said.


Hopefully Murphy’s estimates are correct ,and GM will pull out of this slump. That wold greatly  boost the economy and maybe GM could higher some of its workforce back once it gets rid of the nasty overhead it’s having to deal with now.  

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Posted on Thursday, May 25th, 2006 at 6:18 am In Auto Warranty  


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