) to sell from neutral, citing its largest supplier Delphi (DPH
)'s recent Chapter 11 filing.
Analyst Ron Tadross said Delphi's bankruptcy filing should raise General Motors's retirement liabilities by at least $6 per share. Among other things, he believes Delphi's Chapter 11 filing raises the odds of General Motors's Chapter 11 filing to 30% from 10%. He says he disagrees with the idea that the union let Delphi file because of General Motors's guarantee of members' healthcare benefits. He keeps his third quarter loss estimate at 40 cents per share, his 2005 loss estimate at $1.75, and his 2006 loss forecast at 50 cents, which he changed last week from 80 cents earnings per share. His price target moves to $18 from $32.