The Turning Point For General Motors Is Now (Here's 4 Reasons Why)
On Thursday, Citi gave an update on General Motors Company (NYSE: GM). Specifically, the firm noted four reasons why its market position has never been better:
- Execution: General Motors' operating margins in North America are rising, and the company is poised to lead with numerous key technologies such as V2V, LTE and Supercruise.
- Earnings: General Motors reported fourth quarter EPs of $1.19 above consensus estimates. Guidance on 2015 earnings looks positive as well.
- Cash Flow: 2015 cash flow guidance was reported above analyst expectations, showing that General Motors has the capital necessary to make capital expenditures and position itself to be a leader in the U.S. automobile market.
- US demand of automobiles: With the fall in gas prices, GM is positioned with many key technologies to take advantage of the recent surge in US automotive sales.
Citi currently rates GM as a Buy with a $49 price target.
Other banks issued comments on the stock as well:
Bank Of America/Merrill Lynch: "On an operating basis, the upside in the quarter was driven by stronger than expected results in South America and GMIO, while other regions were largely in-line…. We continue to expect GM's results to be led by NA in the near term, particularly considering strong industry mix & pricing and GM's upcoming product launches."
Morgan Stanley: "NA results were in line but look to be high quality (destocking) while the 20% EBIT beat vs. consensus was driven by LATAM, EU and non China IO. Under the circumstances, results were excellent – but the 20% dividend increase is what drives the stock."
General Motors is up almost 1.4 percent during Thursday's trading.
Image credit: Public Domain
Latest Ratings for GM
|Jan 2017||Daiwa Capital||Downgrades||Neutral||Underperform|
|Dec 2016||BMO Capital||Initiates Coverage On||Market Perform|
|Dec 2016||Macquarie||Initiates Coverage On||Outperform|
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