This has been a tough week for General Motors Co. (NYSE: GM). Well, at least a tough week for the company’s stock, which has posted a new 52-week low again Friday after hitting a new low mark on Wednesday. Shares dropped to $30.09 about an hour after Friday’s opening bell.
A big part of GM’s problem, of course, is the massive number of recalls the company has issued this year. Just over 30 million vehicles have been recalled in North America, and the cost of these is adding up. The other fallout from all the GM recalls is that now it seems the company issues a recall whenever a car’s ashtray fills up. Erring on the side of consumer safety is a refreshing change for GM and its customers, but it does dampen profitability.
Sales are faltering in some markets too. Brazil and Russia spring to mind immediately. Sales in Europe remain awful. GM is cutting production at its plant in St. Petersburg and offering buyouts to 500 of the plant’s 2,000 workers.
Morgan Stanley’s analyst cut his price target on GM stock earlier this week from $29 to $27 and affirmed an Underweight rating. A UBS Investment Bank analyst does not expect GM to reach the current consensus estimate for earnings per share of $0.99 when it reports third-quarter results later this month.
Into this mix steps Chrysler, which is expected to begin trading Monday on the New York Stock Exchange as Fiat-Chrysler Automobiles N.V. under the ticker symbol FCA, after the merger is completed on Sunday. There will be no IPO; Fiat SpA will transfer shares to New York from Milan and those shares will begin trading Monday morning at the dollar conversion price. Shares of Fiat closed at $8.98 on Thursday.
GM’s shares were trading at $30.90, down about 0.5% for the day, in a 52-week range of $30.09 to $41.85.
ALSO READ: Has Volkswagen Given Up on Selling Cars in the Americas?
Top Gaining Stocks
Top Losing Stocks