Morningstar

General Motors, Peugeot Deal May Not Be So Likely

We caution against too much enthusiasm on the news of GM possibly selling Opel and Vauxhall.

Securities In This Article
General Motors Co
(GM)

GM and Peugeot have a recent past, with GM announcing a 7% equity stake in the French automaker in February 2012. GM then sold these shares in December 2013 for a $152 million gain as GME brought in new leadership after the investment of Peugeot, current GME President Karl-Thomas Neumann, who came from Volkswagen in March 2013. We suspect Neumann was not as enthusiastic about the Peugeot investment as then-GM vice chairman Steve Girsky was. Girsky has since left GM and its board. Current CEO Mary Barra may also not have liked the deal, as she became CEO the month after GM sold its stock.

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About the Author

David Whiston, CFA, CPA, CFE

Strategist
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David Whiston, CFA, CPA, CFE, is a strategist, AM Industrials, for Morningstar*. He covers stocks in the automotive industry, including dealerships, parts manufacturers, and automakers. He has covered the automotive industry since joining Morningstar in 2007. He writes stock reports, ad hoc reports, stock analyst notes, and builds discounted cash flow models for each company covered. He also assesses their economic moat and makes frequent television and print media appearances in local, national, and international news outlets. Key stocks covered include GM, Ford, CarMax, and all six publicly traded franchise auto dealers, such as AutoNation and Penske Automotive Group.

Before joining Morningstar in 2007, Whiston spent four years in PricewaterhouseCoopers’ New York real estate audit practice and one year in its Chicago office working on real estate acquisition due diligence, gaining experience around assessing an asset’s cash flow.

Whiston holds a bachelor’s degree in business administration with a concentration in accounting from the University of Richmond’s Robins School of Business. He also holds a master’s degree in business administration with concentrations in finance, economics, and organizational behavior from the University of Chicago Booth School of Business. He holds the Chartered Financial Analyst® designation, and he is a Certified Public Accountant and a Certified Fraud Examiner.

In 2012, he ranked first in the specialty retailers and services industry in The Wall Street Journal’s annual “Best on the Street” analysts survey. He ranked first in the same industry in 2011 .

* Morningstar Research Services LLC (“Morningstar”) is a wholly owned subsidiary of Morningstar, Inc

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