General Motors' Cadillac emblemShares of General Motors (GM) rose as much as 2.5% in trading Tuesday after several brokerage houses began coverage of the stock, with several issuing upbeat initial ratings and hefty price targets.

Analysts at Credit Suisse (CS), Morgan Stanley (MS), JPMorgan Chase (JPM) and Barclays Capital (BCS) all started GM at an overweight rating, the firms' highest, according to Dow Jones Newswires. Citigroup (C) and Bank of America's (BAC) Merrill Lynch unit initiated coverage with buy ratings. Privately held Soleil Securities also started coverage but with a hold rating.

The rush of new analyst coverage comes with the end of the 40-day quiet period barring analysts at banks involved in the automaker's initial public offering last month from commenting on GM. The IPO was the largest in U.S. history, raising more than $20 billion and reducing the federal government's stake in Detroit-based GM to about 33%, down from 61%.

More New Models Are a Ways Off

In conjunction with their new ratings, several analysts also issued bullish price targets on GM shares, ranging from the low $40s to as high as $50, coming from Morgan Stanley. At midday, GM's shares were trading at $35.30 each.

Analysts are upbeat on GM even as the automaker faces a difficult 2011, according to a report in The Wall Street Journal (subscription). Though GM just began production of the long-anticipated Chevrolet Volt gas-electric hybrid hatchback, another round of fresh product releases aren't expected until 2012.

Those include a redesigned Chevrolet Malibu midsize sedan, an important component of the division's passenger-car lineup. A year later, GM plans to introduce redesigned versions of full-size Chevrolet and GMC pickups and sport-utility vehicles.

A trio of Citigroup analysts suggested the best time to buy auto stocks is ahead of new-vehicle introductions, criticizing a trend by industry experts "to dismiss an automaker's product cycle potential at the bottom and overestimate its sustainability at the peak."

GM has reported three profitable quarters so far this year and expects to report positive earnings before interest and taxes in the fourth quarter, "albeit at a significantly lower run rate than each of the first three quarters," the company said last month, adding that it also anticipates profitable year-end results in 2010.


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kenneth

Dream on, sheep. Follow the herd straight to the slaughter. Just wait until GM announces sales of the vaunted Volt came in at (drum-roll, please)1000 units per month! To attain that $40 M in gross sales, they probably will have spent $5 million in advertising, $100 M in actual production costs, $1 B amortizing the development costs (which continue to rise). You have undoubtedly heard the old saw about "making it up on volume." I predict the Volt will be such a collosal failure that it will drag the company down. Stock at $30 by end of 2011.

December 29 2010 at 12:31 PM Report abuse -1 rate up rate down Reply
frenchy7399

What happened to all the Stocks I bought in GM before I retired At one time they were over $90

December 29 2010 at 8:45 AM Report abuse +1 rate up rate down Reply
frenchy7399

How much are the stocks I bought while I was working at GM worth now???

December 29 2010 at 8:38 AM Report abuse +1 rate up rate down Reply
as2010isover

GM is obamas union thug czars, boycott the scum.

December 28 2010 at 8:31 PM Report abuse -1 rate up rate down Reply
1 reply to as2010isover's comment
Don

Boy, aren't you the intelligent d---head! Yeah, root for them to fail so we can lose the tax dollars that are invested in them....oh yeah, and it's always a great thing to boycot an American company. Moron. If GM fails WE ALL LOSE! Pull your head out of your ass!

December 29 2010 at 7:27 PM Report abuse +1 rate up rate down Reply
sailor7379

GM? Go to the dealeship, same attitude that they are doing the customer a favor...same old...same old. Always bought GM, until I couldn't look at their ugly stuff without They didn't take a dime from Obamination. That is truly the American way. Pick yourself up and go forward.

December 28 2010 at 7:12 PM Report abuse +1 rate up rate down Reply
Robert & Lisa

I'll be evil, ultra rich Demoncrat backer, George Soros isn't investing in GM. He's got tons of gold though. Guess he's not betting on the dollar?

December 28 2010 at 6:25 PM Report abuse +2 rate up rate down Reply
1 reply to Robert & Lisa's comment
Robert & Lisa

bet instead of be...

December 28 2010 at 6:27 PM Report abuse rate up rate down Reply
richard

GM was on the ropes a short time ago. What changed? Well, it's simple. Bankruptcy meant renegotiating union contracts which resulted in lower payroll and health care payouts. With lower costs, GM can now compete. And if they didn't have affirmative action, GM would be able to hire capable people and do even better. Do this with all American companies, give them lower costs and the right to hire people for their ability to do the job, and they will flourish too, instead of being driven out of business or forced to move to other countries, as is happening now.

December 28 2010 at 6:24 PM Report abuse +1 rate up rate down Reply
Robert & Lisa

All you Demoncrats need to invest all of your money in Government Motors. Then when it's taken away from you, you'll be irrevalent.

December 28 2010 at 6:24 PM Report abuse rate up rate down Reply
Robert & Lisa

After the GM bondholders got the shaft from the corrupt Demoncrat government and union thugs, I'm surprised anyone with any brain at all would invest in GM. It's a rigged game.

December 28 2010 at 6:22 PM Report abuse rate up rate down Reply
marine1942

The big firms mentioned all have positions in GM so it is to their ( not the public ) advantage to promote GM.

December 28 2010 at 6:18 PM Report abuse +1 rate up rate down Reply