As earnings season gears up for another go-round, all the biggest names are queuing up on Wall Street to report their second-quarter numbers. On Tuesday, we hear from General Motors
After the news comes out, we'll have time aplenty to dissect it. But in these few hours before we begin obsessing over General Motors' short-term progress, let's take a moment to review what investors think about it as a long-term investment. Our tool in this endeavor: Motley Fool CAPS, where we poll more than 60,000 investors for their views on more than 4,000 companies, GM among them. Here's what Fools have to say about the company.
Up or down?
More than 1,700 investors have submitted opinions on the company, making General Motors the 43rd most-rated stock in all of CAPS. The verdict: Generally unfavorable.
More than two-thirds of CAPS investors expect General Motors to lag the stock market going forward. Worse, the very best investors -- our CAPS All-Stars -- give the firm a whopping 83% unfavorable rating. No surprise here, folks: GM gets only a single, solitary star on CAPS -- and that only because we don't give "zero stars" as an option.
Relative to its peers, here's how GM fares:
|
Major Auto Manufacturers Group |
|
|---|---|
|
Honda |
***** |
|
Toyota |
***** |
|
Tata Motors |
***** |
|
Nissan |
*** |
|
DaimlerChrysler |
** |
|
Ford |
* |
|
GM |
* |
Wall Street vs. Main Street
Wall Street is a bit more forgiving of GM's faults. Half the analysts we track think it's an outperformer, and half don't. So far, though, the "nays" have it, with GM's stock lagging the S&P 500 by a dozen percentage points over the last 52 weeks.
Bull pitch
Americans may not be interested in buying American cars anymore, but American investors sure are buying GM's turnaround story. A survey of CAPS pitches predicting GM's turnaround cites product improvements that should boost sales, the prospect of UAW negotiations to reduce costs, and a couple of aces in the hole: strong performance by GM in China and Europe.
Actually, make that three aces in the hole. One bright lad sees a chance for GM to overtake Toyota in a single bound if it can move its "Volt" plug-in hybrid into commercial production. For the record, I think that's a very real possibility. (Read why here.)
Bear pitch
Eschewing pie in the sky, bears expect GM to continue dining on crow, thanks to its "terrible cost issues and terrible products that cost too much to be taken seriously." They cite the perennial U.S. Rust-Belt bugaboos of high health care and labor costs, along with stringent union contracts that make it difficult for GM to shed surplus employees. The bears conclude that GM lacks a "comparative advantage" versus European and Japanese automakers, and must eventually go the way of the dodo.
Who said that?
To learn the identities of the wise Fools who penned these words, to examine their records (and see whether they know what they're talking about), and to explore the plethora of additional financial data we've put together on the company, just click here.
Fool contributor Rich Smith owns shares of UnitedHealth. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 1,165 out of more than 60,000 raters. Nissan is a Global Gains newsletter recommendation. The Fool's disclosure policy just looks at the gas mileage.
