General Motors Company GM shares are trading higher on Thursday.
The company has been upgraded to Outperform from Peer Perform at Wolfe Research, with a price target of $42.
The upgrade follows GM's report of a 14% surge in 2023 U.S. vehicle sales to 2.6 million, driven by a 61% increase in Buick and a 20% rise in GM Envolve sales.
The automaker has been upgraded as the company is believed be better positioned to benefit from a more moderate interest rate environment.
Also See: Expert Outlook: General Motors Through The Eyes Of 15 Analysts
Wolfe analyst Rod Lache mentioned that, as an original equipment manufacturer (OEM), General Motors would experience a more significant benefit from stable interest rates compared to suppliers.
Moreover, OEMs will excel if vehicles with internal combustion engines outlast comparable EVs in a given scenario.
Yesterday, the company was in the headlines for reportedly offering $7,500 incentives on its electric vehicles that lost a U.S. government tax credit this week.
The automotive behemoth told its dealers it would provide the equivalent EV tax credit purchase charge for any vehicles that became ineligible due to the new guidelines.
"In 2024, we expect industry sales to remain strong and we're excited about the opportunities ahead as we expand customer choice with new vehicles like the Chevrolet Equinox EV and Cadillac Escalade IQ," said Marissa West, GM Senior Vice President and President, North America in the company's investor presentation slides.
Price Action: GM shares are trading higher by 1.15% to $35.67 on the last check Thursday.
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