What Do Analysts Say about GM’s Stock before Its 4Q16 Results?



General Motors’ 4Q16 earnings

Previously, we saw that analysts are expecting General Motors’ (GM) 4Q16 earnings to be mixed despite a positive stock performance in the fourth quarter last year. Apart from earnings estimates, investors should also pay attention to Wall Street analysts’ recommendations, as they may affect the company’s stock price movement. In this article, we’ll explore what analysts are recommending for GM ahead of its 4Q16 earnings release.

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Analysts’ recommendations and targets

According to the latest data compiled by Reuters, 35% of analysts covering General Motors have given “buy” recommendations to GM, while 57% of analysts have given it “hold” recommendations. Only two analysts among the 23 covering the stock have recommended a “sell.”

Continued strong US sales of utility vehicles and trucks as compared to small cars could be a reason why most analysts are maintaining a positive view on GM’s stock. Heavy vehicles such as utility vehicles and trucks typically have higher margins than small cars.

As of January 31, 2017, GM’s consensus 12-month target price was $38.45 with an upside potential of 5.0% from its market price of $36.61. If popular Wall Street analysts change their views, a significant short-term movement in the stock price could occur.

Recommendations for peers

Analyst estimates for the 12-month return potential of General Motors’ peers (FXD) are as follows:

  • Ford (F): only 29% of analysts gave it a “buy” with about 5.2% upside potential.
  • Fiat Chrysler (FCAU): 37% of analysts gave it a “buy.” However, its target price was $10.55, lower than its market price of $10.99.
  • Tesla Motors (TSLA): 27% of analysts gave it a “buy” with no major upside potential.

Continue to the next article to find out what analysts are estimating for General Motors’ 4Q16 revenues.


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