General Motors’ 4Q16 earnings
Previously in this series, we learned about some key factors that could affect General Motors’ (GM) valuation multiples in the coming quarters. Apart from valuation multiples, it’s also important for investors to pay attention to Wall Street analysts’ recommendations, as they may affect the company’s stock price movement. In this part of the series, we’ll explore what analysts are recommending for GM after its 4Q16 results.
Recommendations on GM
According to the latest data compiled by Reuters, 35% of analysts covering General Motors have given “buy” recommendations, while 57% of analysts have given it “hold” recommendations. The remaining 9% of analysts among the 23 covering the stock have recommended a “sell.”
If popular Wall Street analysts change their views, a significant short-term movement in the stock price could occur. As of February 8, 2017, GM’s consensus 12-month target price was $38.50 with an upside potential of about 9.6% from its market price of $35.14.
Despite strengthening US sales of trucks and crossovers, GM’s market share in these two segments dropped last year. However, the company’s improving retail market share could be the main reason why some analysts are still maintaining a positive view on GM’s stock.
Also, the company’s focus on new opportunities such as the personal mobility business and electric vehicle and autonomous vehicle development could keep investors’ optimism alive.
For Ford (F), GM’s direct US peer, 29% of analysts covering the company have recommended a “buy” with about 5.8% upside potential. At the same time, analysts’ consensus target prices for other automakers (FXD) including Fiat Chrysler (FCAU) and Tesla (TSLA) are lower than their stocks’ market price.
Continue to the next article to learn about updated technical support and resistance levels for GM’s stock.