Why did this ALL STAR outperform General Motors (GM)?
Simple answer...General Motors won't head into bankruptcy. My confidence in that is around 85%.
It is based on the following press releases that have come out in recent days since my Outperform pick (which I plan to keep all the way to the June 1st deadline and if I am right...beyond).
1) Russia, not just Italy's FIAT want's a piece of GM's assets in their OPEL name brand.
2) New news surfaces that China's Gyaat is interested in GM's SAAB name brand.
3) Over the radio news, I learned that GM's dealerships want to get together and buy the Pontiac Name Brand.
Put all that together and a successfull (hopefully) meeting full of compromises and concessions with the UAW workers and you got a plan that could nullify the need to file for Bankruptcy.
Any presser that comes out and states, "GM No longer has to file for bankruptcy" will send the stock to at least $5.00 a share. Not right away though as GM needs to explain away their short-term plans for producing a competitive strategy with their 4 brands... They need to make it clear to the shareholders whether or not they can be profitable by 2011 or at least 2012, along with a coherrant business model spelled out that investors can believe in and rally behind.
I think all that and more will fall into place by the end of this month, or the end of the beginning week of June. Believe me..A lot of people will be kicking themselves that they did not have the GUTS to buy any shares of GM when and IF (BIG IF) this happens.
Like I said.... I can't say 100% to anything.. My Outperform on GM remains a high risk green thumb.
But look at my track record of outperforming high risk OMG stocks just as they skyrocket (recently):
5) BAC <----Despite stress test spook scares and recapitalization scares I stood behind my outperform.
6) WHR <---- Despite Motley Fool continuously giving this 2 stars out of 5....
7) SKX <----- My call on Skechers was a HUGE call based on real shopping experiences.
Let's face it. We are in a Bull Market where even the improbable becomes probable. So, even with Chrysler in Bankruptcy Court and all signs point to Bankruptcy for GM..... Anything is possible.
But even still... Even given these insane Outperform risk picks I've been doing to build CAPS points to now over 3,000.... I don't make them lightly.