Morgan Stanley Provides Color on General Motors

Morgan Stanley provided color on General Motors GM. In a research report, Morgan Stanley stressed that in case of a double dip recession, GM's stock could fall as low as $10. In the report, Morgan Stanley states, “Downside scenario: Severe global recession. GM volume falls 15% in 2012, 1% EBIT margin next year (-3% by 2013). A doubling of cash injection into US pension to $21bn. NOLs worthless. GM Finance at 0.5x book. Chinese JVs worth half to $6bn. Burns $3 to $5bn of cash per annum through 2015. GM worth $10.” At the moment, Morgan Stanley has an Overweight rating with a price target of $50 placed on the company's stock. On Monday, GM lost 6.61% of its value to finish the day at $24.57. Its shares continued to slide in today's pre-market trading, falling 1.3% to stand around $24.25.