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GM shares tumble to lowest share price in more than 33 years; Ford dips to 52-week low(Associated Press WorldStream Via Acquire Media NewsEdge) DETROIT_Shares of General Motors Corp. plunged to their lowest price in more than 33 years, and Ford shares hit another 52-week low Thursday as analysts continued to speculate about just how bad things will get for U.S.-based automakers. In afternoon trading, GM shares fell $1.28, or 10 percent, to $11.53, after tumbling as low as $11.21 earlier in the session. The last time the Detroit-based automaker's shares dropped below the $12 mark was on Jan. 2, 1975 when they fell to $11.68, according to the University of Chicago's Center for Research in Security Prices. Thursday's low of $11.21 ties a low point on Dec. 30, 1974, the group said. The center adjusts prices for stock splits. Ford shares hit a 52-week low of $4.94 in early trading before recovering to $5.03 by afternoon, still down 21 cents, or 4 percent. They have traded as high as $9.70 over the past year. GM's drop came after a Goldman Sachs analyst cut his rating to "Sell" from "Neutral" and his price target to $11 from $19, saying things could still get worse for the North American automotive industry as a whole. "We expect GM shares to continue to underperform as market fundamentals deteriorate which exacerbates liquidity concerns," the investment bank's Patrick Archambault wrote in a note to investors. "We think GM's automotive cash flow burn this year and next is likely to lead it to look to raise capital, which we believe could lead to significant shareholder dilution and/or a cut to the company's dividend." GM Chairman and CEO Rick Wagoner told reporters Thursday that the company has adjusted to the change in consumer demand from trucks and sport utility vehicles to cars and crossovers, and that it has ample liquidity. "I think we've been quite proactive in adjusting to the fact that consumers are shifting out of trucks," he told reporters at an economic summit with Democratic Presidential Candidate Barack Obama in Pittsburgh. "We've got a very good, solid funding base under any scenario we see, solid through the end of the year." Archambault, however, wrote that second-quarter earnings likely will be weak due to prolonged factory shutdowns at GM and a 22 percent truck production at Ford. "And we believe several companies could revise guidance in the face a perfect storm of volume cuts and commodity cost pressures," he wrote. GM shares had traded as high as $43.20 over the past year. The share price drops went along with the rest of the market. The major indexes showed losses of more than 2 percent, including the Dow Jones industrial average, which shed 300 points and dropped to its lowest level in two years. ___ AP Business Writer Bree Fowler in New York and Associated Press Writer Dan Nephin in Pittsburgh contributed to this story. Copyright ? 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. |