JP Morgan Maintains Overweight on General Motors After 4Q Earnings

JP Morgan has published a research report on General Motors

after the company reported 4Q earnings in-line with estimates and with promising outlook. In the report, JP Morgan writes, "Excluding $0.3B of restructuring charges which GM includes in adjusted EPS but which the sell-side (including JPM) likely did not, we believe this was an apples-to-apples underlying EPS beat of about $0.10-0.15. Cash flow was stronger than expected. 2011-ending pension underfunding widened by $3B globally, roughly in line with expectations. Guidance on pension expense ($0.8B higher y/y) and other costs excluding pension (flat) largely offset each other relative to our model. Other pieces of directional top-line guidance (price/volume positive, mix negative) seem largely consistent with JPM's model. Further, we sense the company believes annualizing Europe Q4 underlying losses excluding restructuring (-$0.4B) would be an overly harsh assumption for full-year 2012, suggesting our current full year 2012 Europe loss forecast of $0.9B is probably ok." JP Morgan maintains its Overweight rating on General Motors, which is currently trading up $2.17 from yesterday's $24.93 closing price.