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General Motors' 1Q17: Behind the Analysts' Estimations

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Part 6
General Motors' 1Q17: Behind the Analysts' Estimations PART 6 OF 8

GM’s 1Q17 Earnings Event: What to Watch

GM’s 1Q17 earnings preview

So far in this series, we’ve covered analysts’ estimates for General Motors’ (GM) upcoming 1Q17 earnings release. Overall, the analysts’ estimates suggest a positive trend in the company’s revenues, despite its YoY (year-over-year) decline in the previous quarter. Also, higher retail sales should help the company’s 1Q margins expand.

GM&#8217;s 1Q17 Earnings Event: What to Watch

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Plans to face tough industry times

Although GM’s retail market share is stronger than that of some peers and reduces its risk profile, any possible downturn in the US auto market (FXD) could hugely affect GM’s business going forward. During GM’s 1Q17 earnings event, investors can thus expect the management to talk about how it plans to deal with the recent downturn in US auto sales.

In 2016, GM accelerated its plans to explore other business areas, including ride-sharing and on-demand mobility services. While revenues from such businesses can’t replace the company’s revenues from vehicle sales in the short term, they do have the potential yield huge returns in the medium term and long term.

Other possible updates

In December 2016, GM started the deliveries of Chevrolet Bolt, its all-EV (electric vehicle) model. The car is priced at $37,500 before federal incentives and delivers an estimated drive range of about 238 miles on a full charge.

Chevrolet Bolt EV and Tesla’s (TSLA) Model 3 both are similarly priced mass-targeted EVs. The deliveries of Tesla Model 3 are expected to begin in the second half of 2017, during which time GM may announce plans to expand its EV lineup in US markets to stay ahead of the competition.

Investors can also expect an update on GM’s autonomous vehicles development program. In the past year, auto companies including GM, Ford Motor (F), and Fiat Chrysler Automobiles (FCAU) have all accelerated their autonomous vehicle development programs. (For more, read Market Realist’s series Autonomous Vehicles: Latest Updates in 2017.)

Continue to the next part for a discussion of GM’s valuation multiple ahead of its 1Q17 earnings release.

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