Banc of America Upgrades GM and Ford
Banc of America upraded automakers General Motors (GM ) and Ford (F ) to neutral from sell.
Analyst Ronald Tadross upgraded GM and Ford due largely to potential UAW healthcare liability reductions and also possible short-term price relief from Toyota price increases.
He raised GM and Ford earnings per share estimates and targets because trends should mitigate a negative effect on his sum of parts per discounted-cash-flow of sales decline, weak supply base, and subpar pension fund returns.
Also, Tadross factored in lower steel prices, potential from more proactive management, and some other adjustments. He raised his GM price target to $33. For Ford, he increased his target to $11.