Posted by: David Kiley on July 23, 2008
Ford and GM? Detroit automakers?
Consider that GM was trading at $10.29 on July 3. Today, it’s $15.86. The fact is that GM at $10 a share was, and is crazy. Warren Buffet said a few months ago that buying GM at $22 was a good move because its breakup value was over $40 billion. It’s market cap was around $10b. Do the math for people who backed the truck up on GM shares at $10.29 a share. GM’s own dealer council just bought over $1 million in GM shares, trying to send a message to everyone that is investing in the automaker.
Ford? On July 11, Ford share had dropped to $4.45. Today, it’s $6.18. Kirk Kerkorian recently paid $8 per share. If Kerkorian just paid $8, and it dropped to below $5…I’m not a stock picker journalist…but I say back the truck up.
I know…this is day trading stuff. But when you see century old industrial icons with as much product on the road as they have, these market caps of less than $10 billion just don’t make sense.
And some daring investors are making truckloads of profit.