With so much bad news and bad press on General Motors (GM/NYSE), it's easy for regular readers of this blog to think the only favorable opinion on the company is found here.
I sometimes feel that way myself. ;-)
Then comes this morning's Bloomberg column from money manager John Dorfman. Scroll down to the middle of the piece and you'll see where he writes:
I featured General Motors (GM) in April on my first-quarter 2005 Casualty List. So far it has brought woe to people who listened to me. The stock fell 37 percent in the fourth quarter and is down 21 percent since I touted it as a bargain.
General Motors remains the world's biggest automaker, yet it is undeniably struggling. It has posted losses in the past four quarters totaling $3.1 billion, announced plans to close 12 North American facilities by 2008, and won concessions from the United Auto Workers regarding health-care costs for retirees.
Then Dorfman continues: I consider a GM bankruptcy unlikely. In my opinion it is
not in the interests of the U.S. government, the UAW or the
public to see the Detroit-based company fail. If I'm right, the stock is a powerful bargain at 0.55 times
book value and 0.06 times revenue. The dividend yield stands at
more than 9 percent, although a dividend cut is a distinct
possibility. As usual with Dorfman, it's worthwhile reading the entire column and the rest of the companies mentioned.
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