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Count me as one of those investors who has always shied away from U.S. airline and automobile stocks. With so many things beyond the control of the companies, coupled with labor unions always trying to suck every last dime they can from management, these stocks have been among the worst long term investments in market history. However, there have still been times when they have made for good trades and with its recent emergence from bankruptcy, General Motors (NYSE:GM) has a strong balance sheet and a lot of tax credits to take advantage of, even if the management team still lacks a positive track record.

After pricing its IPO at $33 per share, GM now trades back down around $31 after hitting $39 in the midst of the IPO excitement. Buffered with $25 billion of net cash on the balance sheet and $16 billion ($10 per share) of tax loss carry forwards, GM is already back in the black to the tune of billions per year and does not have to worry about paying most of its tax bill for a long time. Earnings per share are expected to reach $4 this year and $5 in 2012. Not a bad valuation cushion for a $31 stock.

Given the company's horrible track record in terms of management and good business decisions, buying the common stock, even at depressed levels with a strong balance sheet, may not seem all that attractive to many. Fortunately, for income investors there is another option. The GM series B convertible preferred shares (GM-PB) pay a $2.375 annual dividend and will convert into GM common stock on December 1, 2013. This security allows investors to earn a nearly 5% yield and also participate in any price bump of the underlying common shares. At about $48.50 each, the preferred issuance is very close to that attractive 5% yield level (buying at $47.50 would equate to exactly 5%).

For those who are seeking yield and are also intrigued by GM's depressed stock price and strong financial picture post-bankruptcy, the GM series B convertible preferred might make for a very strong investment.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.