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Analysts’ Recommendation on General Motors Stock

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1Q17 earnings

It’s important for investors to pay attention to Wall Street analysts’ recommendations. Analysts’ recommendations could impact the company’s stock price movement. In this part of the series, we’ll explore what analysts recommend for General Motors after its 1Q17 earnings results.

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Analysts’ recommendations

According to the latest data compiled by Reuters, 36% of the analysts covering General Motors gave “buy” recommendations, 59% gave “hold” recommendations, and 5% gave “sell” recommendations.

If popular Wall Street analysts change their views, there could be significant short-term movement in the stock price.

As of May 2, 2017, General Motors’ consensus 12-month target price was $39.95 with an upside potential of over 20% from its market price of $33.20.

With strengthening US truck and crossover sales, General Motors’ market share in the two segments also rose in 1Q17. The company’s improving retail market share could be another reason why analysts are still maintaining a high price target on General Motors stock.

In contrast, any significant weakness in US auto sales could hurt General Motors’ future earnings forecast. Therefore, investors should keep a close eye on US auto sales in 2Q17. Note that a downturn in US auto sales could have a negative impact on other mainstream automakers (FXD) including Ford (F), Fiat Chrysler (FCAU), and Toyota (TM).

Peer comparison

For Ford, 33% of the analysts covering the company recommended a “buy” with ~18% upside potential. At the same time, analysts’ consensus upside potential for Fiat Chrysler is 47%.

In the next part, we’ll discuss General Motors’ updated technical levels after its 1Q17 results.

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