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Point72 Asset Management Ups Its Stake in General Motors

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Point72 Asset Management and General Motors

Point72 raised its position in General Motors (GM) during 4Q14. The fund added 3,751,800 General Motors shares during 4Q14. The fund held 4,415,700 General Motors shares. It accounted for 1.08% of the fund’s total 4Q14 portfolio.

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About General Motors

General Motors sells, builds, and designs trucks, cars, and automobile parts all over the world. The company operates through its major automotive segments:

  • GM Europe
  • GM North America
  • GM South America
  • GM International Operations

As of December 31, 2013, General Motors had more than 100 locations spread across 80 cities and 25 states within the US. With annual revenue of over $155 billion, the company is ahead of its Detroit-based counterparts Ford (F) and Chrysler (FCAU). The company’s selling channel to end users is primarily through auto dealerships like AutoNation (AN), Lithia Motors (LAD), Penske Automotive Group (PAG), and CarMax (KMX).

General Motors also offers automotive financing through General Motors Financial Company.

General Motors is part of the Consumer Discretionary Select Sector SPDR ETF (XLY). It accounts for 2.23% of XLY. It also accounts for 2.17% of the iShares U.S. Consumer Goods ETF (IYK).

Revenue declined in 4Q14

In 4Q14, revenue declined slightly to $39.6 billion—compared to $40.5 billion in 4Q13. This was due to disappointing results from all of the segments except North America. North America’s revenue grew 0.8% to $25.3 billion. It was driven by lower fuel prices. The lower fuel prices stimulated demand for larger vehicles like trucks and crossovers. GM International’s revenue was down 13.2% to $3.8 billion. GM Europe’s revenue also fell 5.1% to $5.4 billion. GM South America’s revenue dropped 9.4% to $3.7 billion.

The company’s diluted earnings per share, or EPS, increased to $0.66. It was $0.57 in 4Q13.

US automotive industry is rebounding

General Motors expects light vehicle sales to remain at 16.5–17 million units in 2015—compared to 16.5 million units in 2014. The automotive industry rebounded from the recession in 2009. During the recession, light vehicle sales bottomed out to about 10.4 million units. Since then, General Motors grew steadily with the economy.

In the next part of this series, we’ll discuss Point72’s position change in Valero Energy.

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