Making Money on GM Investment

What are the odds that we are going to earn the bailout money back on GM ever?

Consider the math:

GM has received $50.7 billion in taxpayer money ($30.1 billion for DIP etc, $20.6 billion previous capital infusion). When Government Motors comes out of bankruptcy,  Uncle Sam will own 60% of it.

At its all time high, GM’s market cap was $56 billion which slid down to ~$7.3 billion prior to chapter 11. (Symbol = GMGMQ.PK)

For the taxpayer to just break even on their investment , the New GM would have to have to reach a market capitalization of $84 billion — almost 150% of its all time peak. That will be tough, even with the new GM’s better capital structure, employee contracts, and much less debt . . .


via What I learned


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