This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

GM Shifts Into High Gear

Volkswagen, by contrast, had worldwide quarterly earnings growth (ending Sept. 30) of over 60% and quarterly revenue growth (year-over-year) of nearly 27%. Talk about a stock that is undervalued! Even though VLKAY is selling near its 52-week high, its forward PE ratio is only 6.63 and its price-to-earnings-to growth (PEG) ratio (five-year expected) is a phenomenally low 0.07.

GM shares have a one-year price chart that looks like an "inverted head-and-shoulders" formation, technically speaking. Its chart below shows quarterly revenue-per-share growth has been outstanding. GM ChartGM data by YCharts

When the federal government orchestrated a bailout of GM, few thought that the big auto and parts manufacturer would rebound so quickly. Its latest plan to spend $5.5 billion to buy back shares comes as the Obama administration works to wind down financial-crisis era programs from the inherited financial fiasco that culminated in 2008.

Initially the stock repurchase announcement last Wednesday sent GM shares surging 6.6% and closd that day's trading session at $27.18. In spite of options expirations and disappointment over the inaccuracy of those who tried to interpret the Mayan calendar, shares were trading Friday above $27.

GM stock trades at a forward (one-year) PE ratio of 7.17 and if you like the number 7, you'll be pleased to know its five-year expected PEG ratio stands at 0.77. As of the most recent quarter ending Sept. 30 its year-over-year quarterly earnings was -13% and quarterly revenue growth was a positive 2.3%.

In the most recent quarter its total cash was almost $32 billion while total debt was a more manageable $16.65 billion. In comparison with Volkswagen's total cash of around $26 billion and total debt of over $119 billion, GM's financial balance sheet is looking better and better.

It may be too early to say, as the late Etta James would sing, "At Last", but it looks like GM has a chance to glide off the fiscal cliff and soar into a thermal updraft of low interest rates and global monetary easing.

By the way, the federal government still has GM shares left at the Treasury. They were purchased at an average price of $69.72 a share, so GM's stocks needs to go up over 250% for the government to come close to breaking even. This gives shareholders a hint for an upside price target.

Stock quotes in this article: GM, VLKAY, PEUGY 

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
DOW 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 +2.54 0.14%
NASDAQ 4,095.5160 +9.2910 0.23%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs