<<<the p/e ratio is pretty low no matter how you look at it.>>>
GM 's p/e is not 'pretty low'. It's excessively high.
It's not just because over $460M of the profit from 2010 is simply interest income from OUR taxpayer cash.
It's not just because some of that profit is also from channel stuffing.
It's not just because old school low growth smokestack industries historically command much more than single digit P/Es.
Most importantly, you have to keep in mind the number of shares is going to go up drastically to dilute that meager profit. Barack Obama has tens of billions of dollars worth of GM he doesn't want. Canada has billions worth and the UAW does too. The number of shareholders, or at least, shares, that are going to fight over that measly profit is going to soar.
So, earnings are inflated. Share count will balloon.
And if that's not bad enough, the UAW is not gone. In fact their stated goal going into contract time is going to be recovering some of their past concessions.
<<<<The union is determined to recover concessions made to the automakers to help them survive. The union surrendered raises, bonuses and cost-of-living adjustments. The union also agreed to a two-tier wage system, in which new hires earn about $14 an hour, half the amount paid to senior production workers. It is estimated that UAW members gave up $7,000 to $30,000 in concessions since 2005.>>>>