GM Rises 1.4 Percent on Results [Reuters]
Summary: General Motors Corp. beat the Street, coming-in with a smaller-than-expected Q3 loss of $115M ($0.20/share), compared to the $1.66B ($2.94) they lost a year ago in Q3. Its losses included "special charges" of $644M, making its adjusted net income $529M. GM narrowed its potential exposure to former GM Parts Unit Delphi Corp.'s bankruptcy filing to $6-7.5B from $5.5-12B. In a victory for GM CEO Rick Wagoner, alliance negotiations between GM and Renault SA/Nissan collapsed earlier this month; Wagoner had been pressured by high-profile shareholder Kirk Kerkorian, who has been critical of Wagoner for not being more aggressive in bringing GM back to profitability. This summer GM announced 35,000 hourly workers accepted incentives to leave, increasing GM's cost savings to $5B this year, and helping it beat its job-cut target. World-wide sales fell 3% for the first half of '06; Q4 production has been pegged at -12% y/y. GM shares were up 2.8% yesterday in anticipation of earnings, and have added another 1.4% in this morning's pre-market ($36.71).
Related links: Background to article: Is Rick Wagoner Corporate America's Comeback Kid of the Year? • GM Investor TCW Group Declares its Support for Rick Wagoner • Jerry York Quits GM Board - Is a Kerkorian Fire Sale Next? • Talks Between GM, Renault and Nissan Fail • GM Lends a Hand to Avert a Delphi Strike • Kerkorian Files With SEC to Up His Stake in GM in Attempt to Push Proposed Merger Forward • Is GM Stalling With Renault-Nissan Alliance? • Seeking Alpha analysis: Despite a Great Year, GM is Still Trailing Japanese Counterparts Like Toyota • Message to GM Investors: Whoa! • GM Posts Narrower Net Loss; Revises Delphi Exposure [WSJ]
Potentially impacted stocks and ETFs: General Motors Corp. (NYSE:GM), Ford Motor Co. (NYSE:F), DaimlerChrysler (DCX), Toyota Motor Corp. (NYSE:TM), Honda Motor Co. (NYSE:HMC) • iShares Dow Jones Transportation Index ETF (NYSEARCA:IYT)
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