Is General Motors a Good Buy?

The Detroit auto giant's initial public offering drove up a lot of hype. But if you look under the hood, you'll find some worrying problems.

You didn’t really think you were going to get shares of General Motors (symbol GM) at the offering price, did you? Well, after taking a look under the hood of GM’s initial public offering, you’ll probably be glad that you didn’t.

The biggest reason to feel lucky is that the stock’s sellers -- not the buyers -- grabbed most of the first-day pop for themselves. When the shares went public on November 18 at $33, the sellers sucked up the premium that investors would have enjoyed had the shares come public at $29, the high end of the original pricing range. GM shares did jump to $35.99 on their first day of trading, but they closed at $34.19, a modest 3.6% above the IPO price. The stock closed at $33.48 on November 24.

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Contributing Editor, Kiplinger's Personal Finance