3 Reasons to Sell GM


The following video is part of our "Motley Fool Conversations" series, in which industrials editor/analyst Brendan Byrnes and consumer goods editor and analyst Austin Smith discuss topics across the investing world.

In today's edition, Brendan and Austin discuss three reasons to sell General Motors. While not explicitly a sell recommendation -- Brendan actually thinks GM is a dirt cheap stock and a great buy today -- we think it's best for investors to look at all sides of the coin when evaluating companies. One reason to consider selling GM is if Europe gets much worse. GM has lost $15 billion in Europe since 1999, and GM's underlying problem on the continent -- overcapacity -- still hasn't been addressed. Another reason to potentially sell GM is if it starts to churn out bad vehicles. GM has done a much better job recently of making quality cars, but if it slips up in this regard, it could lose some customers forever in such a competitive industry. Finally, considering the U.S. government still owns more than 30% of GM's shares, GM's stock price could be depressed when Uncle Sam decides to unload its shares. Check out the video below for more analysis on when investors should consider selling GM.

Many investors may be nervous about investing in a company that's internationally focused, but they shouldn't be. Emerging markets are giving new life to established American companies with deep pockets. As these industry titans look abroad for more sales, they aren't starting with a blank slate -- they're bringing their operational excellence to new markets and thriving. To uncover these picks today, we invite you to read a copy of our free report: "3 American Companies Set to Dominate the World." The report won't be available forever, so we invite you to click here to get your copy today!

At the time thisarticle was published Austin Smithhas no positions in the stocks mentioned above.Brendan Byrnesowns shares of Ford. The Motley Fool owns shares of Ford.Motley Fool newsletter services recommendFord and General Motors Company. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.