2006 Stocks and Investments

Coming off a year filled with turmoil in the stock market, big companies are having a hard time scraping by. Companies, like Ford are taking huge losses every quarter. Google had a hard time in the market just a few days ago, at the end of their quarter their 80% increase in profit fell short of expectations leaving the company’s stock off some thirty points in the market. The market seems ripe for some huge changes and with an announcement by GM and other investor information; it seems that the economic recovery that is being touted by Bush is really questionable.

GM announced on Tuesday, February 07, 2006 that they are cutting their yearly dividends from $2/share to $1/share. This move is likely to anger some shareholders but may make sense in the long run as GM tries to move back into profitability. The upper management of GM is also taking pay cuts; the CEO is taking a full 50% pay cut. This is a move by the board of directors, a shocking and drastic one but an impressive one, as we see that more is being done for the shareholders.

A big Time-Warner Cable investor, Carl Icahn, pointed to a Lazard Ltd. Report that suggests that Time Warner Cable split itself off into 4 separate companies. It does not seem that the company will follow these suggestions but it said that they will look at the report.

BP, a British oil company increased its value to £19.3 billion ($33.6 billion) this past year. However, it fell short of industry expectations. This failure (despite a 25% increase in revenues) is indicative of financial overshooting based on the idea of a good economy. There are more revenues now than before; however, the market does not have the ability to yet make it into what was typical in the market before the 2001 recession.