Options Wonderland

[samaelrocks]

GM downgrade? What about Ford?

Goldman cut its rating on GM to sell from neutral and lowered its price target to $11 from $19, saying deteriorating market fundamentals could exacerbate liquidity concerns.
"We think GM's automotive cash flow burn this year and next is likely to lead it to look to raise capital, which we believe could lead to significant shareholder dilution and/or a cut to the company's dividend," analyst Patrick Archambault said in a note.


http://www.marketwatch.com/news/story/general-motors-shares-slump-after/story.aspx?guid=%7B8DE90DA3%2D2420%2D4C57%2D94C7%2DE2AE3698285F%7D&siteid=yhoof

Ford has 2.24 Billion shares outstanding! If they need to raise capital, the dilution would be tremendous. Ford has some of the same problems GM has.

Ford is under $5 now. If they needed to raise 1 million bucks, add about 250k shares to the OS.