Last week (ended April 15), General Motors’ (GM) stock traded on a mixed note and posted 0.9% weekly fall. The company’s stock is now trading with 5.6% MTD (month-to-date) losses, despite performing better than peers in 1Q17 US sales.
Let’s take a closer look at some key factors that could be driving pessimism among GM investors.
Inside the 1Q17 US sales figures
In the first quarter of 2017, GM’s home market sales remained firm at ~690,000 vehicle units, with a ~0.9% YoY (year-over-year) increase. These US sales gains were much better than peers (IYK) Ford Motor (F), Fiat Chrysler Automobiles (FCAU), and Toyota Motor (TM).
However, GM’s all vehicle days supply levels have grown dramatically in the past few months. At the end of March 2017, GM’s all vehicles adjusted supply levels were at 98 days—about 38% higher than its level of 71 days at the end of March 2016.
These higher day supply levels suggest that GM’s monthly vehicle sales rate is slowing in comparison to its monthly vehicle supply to dealers. These high dealer inventory levels could be the primary reason for worry among GM’s investors.
Technical levels for this week
As of Thursday, April 13, GM’s stock was trading at $33.39 on a bearish note. On Thursday, the stock price closed below a key support area near $33.60, which should act as an immediate resistance this week. Notably, the $33.60 resistance level is also important because it’s near the 200-day SMA (simple-moving-average) on GM’s daily stock price chart.
On the downside, the stock’s key support range lies around $32.80–$32.60.
Continue to the next part for a closer look at Ford.