InvestorPlace – Stock Market News, Inventory and Trading
General Motors (NYSE: GM) is used to the long term in terms of years, even decades.
A few years ago, under the leadership of CEO Mary Barra, she hatched an automotive plan to meet the challenge of Tesla (NASDAQ: TSLA), then a struggling electric car maker.
You know what happens to prudent plans. They’re only smart until he hits you in the mouth and 2020 hits GM in the mouth.
General Motors enters on September 10 with approximately $32 in line with the stake, a market limit of approximately $46 billion, on sales of approximately $50 billion in the first half. Billing is just over 4 times Tesla’s. But don’t tell the inventory market.
Barra despite everything made the decision that if he could not beat Tesla, he deserved to join him.
For the meeting and portion source of Nikola (NASDAQ: NKLA), a young electric truck manufacturer, GM said this week that it will receive $2 billion in shares from Nikola and a seat on the board. The news caused GM’s stock to go up 10%. He sent the shares of NKLA, whose truck until now was the most common vaporware, up to 40%. Nikola’s market capitalization is now 40% GM’s, productless.
General Motors also presented a plan with Uber (NASDAQ: UBER) to finance the acquisition through drivers of the Chevrolet Bolt, the company’s best-selling electric vehicle. It comes months after GM shut down its own car-sharing service, Maven.
Suddenly, GM is a hot stock again, with 11 out of 15 analysts buying it. The last 3 analyst reports say “buy. ” Barra is doing his best to raise the price, stating that demand is developing faster than expected.
Maybe it is.
But this is not last year’s general manager. Last year, the company made a profit of $ 6. 7 billion on sales of $ 137 billion. This year’s company, through June, has lost $ 750 million in sales of $ 49. 6 billion. Operating money for 2020 is negative so far. GM also has about $ 127 billion in debt, compared to Tesla’s roughly $ 12. 6 billion.
Barra stimulates the business of because today it does not do what the inventory market needs. The inventory market needs electric vehicles. So, Barra promises VE. Investors hope that you will spin off those transactions to bring in money.
Genuine hope may be just the U. S. Military, which recently awarded GM a $214 million contract to equip his Colorado truck as an army vehicle. The infantry defense vehicle can result in a new electric GMC Hummer. The contract means that GM Defense can drive the company’s effects in the coming years.
Add Tesla’s existing market limit to your debt and you’ll get a trading price of around $320 billion. GM’s market capitalization plus debt is $173 billion. The festival between the two is not as one-sided as it seems. GM also has Washington on his side. It’s going to have to be nice.
But if we look to an all-electric two-step future, GM starts far behind: it will have to keep selling gasoline cars, for profit, to hope to close the gap. November 5, with an expected profit of $34. 5 billion.
Dana Blankenhorn has been a generation and money journalist since 1978. She is the character in the environmental mystery Bridget O’Flynn and the Bear, available on the Amazon Kindle store. Email him at danablankenhorn@gmail. com or stay with him on Twitter at @danablankenhorn. At the time of writing, he did not own any shares in the corporations mentioned in this story.
The post GM Stock: What happens after Tesla hits the car manufacturer in the mouth?gave the first impression on InvestorPlace.