Call it prosperity without a whole lot of pull, at least when it comes to investors. This is the new reality of the auto industry. Business is booming, profits are strong, investors are indifferent.
Just look at General Motors . The world’s largest automaker beat the street with first quarter earnings of $.93/share (est.: $.85/share) earnings $2.2 Billion EBIT and $1 Billion in net profits. By all accounts, it was a solid quarter.
That’s nice, but shares of GM continue to trend lower (down more than 30 percent in the last year) because of concerns about a lack of growth later this year and a weak European economy pressuring the bottom line.
GM’s not the only automaker in this boat. Look at the auto stocks in the last year (as of May 3RD):
There are a few exceptions in the auto industry. Some stocks like Borg Warner are up in the last year. Some of the auto dealer stocks, like Group One are also seeing great returns for investors.
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