GM Sets an Ambitious Profit Margin Target

[Stocks-to-Watch]

General Motors (GM) is likely to post about $8 billion in earnings for 2011, the Wall Street Journal reported today. But the company is already starting to aim higher.

GM is looking to raise its profit margin to 10% from current levels around 6%. At that level, the company would generate about $10 billion in profits, the Journal calculated. And that’s at current revenue levels — any bump in revenue on higher car sales could make the impact even greater. An earnings boost would be good for the government too — at the current stock price, the government would lose $10 billion if it sold its GM stock.

One other thing: call me a traditionalist, but isn’t it odd that “people who have seen the figures” are leaking earnings numbers for GM a week before they are scheduled to report (Feb. 16)?

GM shares were recently up 0.5%.



Original Article Source by Barrons.com