For Immediate Release
Chicago, IL – August 7, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Ford (F), Toyota (TM), Honda (HMC), American International Group (AIG) and Goldman Sachs (GS).
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Here are highlights from Thursday’s Analyst Blog:
“Cash for Clunkers” Continues
Not a complete answer to our dependency on imported oil, but not exactly a drop in the bucket, either. If the second installment works just as well, we up to a cumulative savings of 675 million gallons fewer of gasoline burned.
This is in addition to the benefit of actually putting auto workers (and suppliers) back to work, and car dealers being actually able to sell some cars and keep their employees. As a result, some of the spending will come back to the government in the form of the income taxes these workers pay.
Keep in mind that it will also result in smaller losses at General Motors and Chrysler, and we the taxpayers have rather substantial equity interests in those firms.
As a result of the program, Ford (F) actually posted a year-over-year increase in sales in July (2.2%) its first increase since 2007. Yes, three of the top five models sold under the program were made by Toyota (TM), but two of those are built in America, as are the other two — one from Honda (HMC) and the other from Ford.
Traditionally, increased sales of durable goods like autos are one of the key engines to power the economy out of a recession (housing is the other traditional engine). The pick up in the sales rate to 11 million from down close to 9 million is a very significant move.
Granted, it is still well below the 16 million rate we were averaging a few years ago, but it is highly unlikely we will get back to those levels for a long, long time. The American consumer simply has far too much debt and needs to rebuild his or her balance sheet. The option of tapping the equity in the house to get a new SUV is simply no longer available.
Still, relative to the rest of the money that has been thrown around trying to stabilize the economy and the banking system, the $3 billion spent on the two installments of the plan is chump change. It is, for example, only 25% of what passed through American International Group (AIG) to pay in full the credit default swaps of Goldman Sachs (GS).
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Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
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