What GM’s ads don’t say: Taxpayers will take a loss on this bailout

So what about the rest of our money?

Today General Motors is running ads patting itself on the back for repaying its taxpayer loans.

“We’re proud to announce: We’ve repaid our government loan. In full. With interest. Five years ahead of the original schedule.”

Absolutely true. As far as it goes. Read more

Update Johnson Controls (JCI)

Before the stock market opened in New York on Friday, April 23, Johnson Controls (JCI) announced earnings of 43 cents a share (excluding one-time items.) That was four cents a share above Wall Street estimates for the company’s second quarter of fiscal 2010.

Including special items—since last year’s second quarter included so many of them–earnings per share climbed to a profit of 40 cents a share from a loss of 33 cents a share in the second quarter of fiscal 2009.

Revenue increased by 32% to $8.32 billion. Wall Street analysts had projected $7.92 billion.

And, best yet, the company raised guidance for the full 2010 fiscal year. Read more

February auto sales disappoint but no reason for panic

You can come up with lots of reasons why investors shouldn’t panic at the slide in February U.S. auto sales to a seasonally adjusted annual rate of 10.4 million. That was down from the seasonally adjusted 10.8 million sales rate in January 2010 although up from the 9.2 million rate of February 2009.

Snow storms. Troubles and more troubles at Toyota. A big drop in sales from brands such as Saturn, Pontiac, Hummer, and Saab that General Motors (GM) has decided to discontinue.

All those cut in February sales and make hard to argue that the recovery in the auto industry has stalled.

But the numbers aren’t a rousing endorsement of pedal to the metal growth either. Read more

Are you in the right sectors of the stock market for this point in the economic recovery? (Yes, despite the stock market correction, we are still in an economic recovery.)

Solid data stretching back to 1945 argues that certain industries and sectors outperform during specific stages of any economic recovery. (The best work on this subject comes from Sam Stovall, the chief investment strategist for Standard & Poor’s Equity Research Services. His 1996 book Sector Investing is still the best resource on the subject to my mind.)

My first rule of investing is “Put every trend you can on your side.” Neglecting what we know about what sectors thrive when is in my opinion wasting an asset that could help you make bigger profits.

Stovall divides the economic cycle into four stages. Read more

Update Johnson Controls (JCI)

Sure, Johnson Controls (JCI) beat Wall Street estimates by a huge 14 cents a share when it announced first quarter fiscal 2010 earnings before the stock market opened on January 22.

But the big news, the news that had the stock up 4.5% for the day as of 2:30 in New York, was the company’s blow out guidance for all of 2010. Johnson Controls now sees 2010 revenue of $33 billion. That’s up from the company’s earlier projection of $31 billion and well above the Wall Street analyst consensus of $31.7 billion. Earnings for fiscal 2010 will be in the range of $1.70 to $1.75 a share. The company had projected earnings of $1.35 to $1.45 a share. The Wall Street consensus was $1.53.

Three things contributed to the earnings and guidance beat. Read more