We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Sporting a Zacks Rank #1 (Strong Buy) General Motors (GM - Free Report) ) lands the Bull of the Day as there could be a nice amount of upside for the auto giant from its current levels.
Trading around $33 per share, General Motors stock is 24% from its 52-week highs with the company’s outlook more refreshing for investors at the moment.
To that point, General Motors was able to beat its top and bottom-line first-quarter expectations last Tuesday and raised its guidance in key areas. Driven by strong customer demand and increased operating efficiency, General Motors said it led the U.S. auto industry in retail and fleet deliveries, commercial deliveries, and truck sales.
This resulted in General Motors blasting Q1 earnings expectations by 35% with EPS at $2.21 per share compared to estimates of $1.64 per share. Year over year Q1 earnings were up 6% with sales jumping 11% from the prior year quarter at $39.98 billion. First-quarter sales also beat top-line estimates by 3%.
Image Source: Zacks Investment Research
EPS Revisions & EV Presence
Aforementioned, General Motors also raised its outlook during its quarterly report and now expects fiscal 2023 EPS between $6.35 -$7.35 per share ($11 billion-$13 billion) and up from previous guidance of $6-$7 per share ($10.5 billion- $12.5 billion).
In correlation, earnings estimate revisions have climbed for General Motors over the last week and this is a great sign GM stock could start rising. Fiscal 2023 earnings estimates increased 5% last week and have now gone up 14% over the last quarter. Plus, FY24 EPS estimates have continued to trend higher as well.
Image Source: Zacks Investment Research
More importantly, General Motors is starting to put an end to fears that Tesla (TSLA - Free Report) ) and other EV companies would diminish its presence in the auto industry. With an electric vehicle expansion of its own, General Motors delivered 20,000 EVs during the first quarter.
This was a quarterly record and almost doubled Ford’s (F - Free Report) ) 10,866 EV deliveries with General Motors surpassing its long-term rival for the #2 spot in the U.S. market share behind Tesla. General Motors said it increased its EV market share by 8% during Q1 to surpass Ford, and unlike Tesla will not cut prices and dip into profits which came as a delight to investors.
Image Source: Zacks Investment Research
Great Value
With earnings estimates on the rise, General Motors’ price-to-earnings valuation is very attractive at just 4.9X forward earnings. This is nicely beneath the industry average of 10.5X and the S&P 500’s 19.1X. Even better, General Motors stock trades 77% below its decade-long high of 22.8X and at a 22% discount to the median of 6.7X.
Image Source: Zacks Investment Research
General Motors’ cash flow is also attractive with the company raising its guidance for adjusted automotive free cash flow from expectations of $5 billion-$7 billion to $5.5 billion-$7.5 billion. Even better, when looking at General Motors’ price-to-cash flow its stock appears to have strong value right now.
With a lower P/CF number being desired many professional investors typically prefer this valuation metric because cash is harder to manipulate on the income statement and bolsters the financial health of a company.
At 2.9X, General Motors P/CF is intriguingly below the industry average of 9.2X and the benchmark’s 16.5X.
Image Source: Zacks Investment Research
Takeaway
Now appears to be an opportunistic time to buy General Motors stock with its attractive expansion in the EV market and the company offering good value to investors.
This is reason to believe there could be a considerable amount of upside in GM shares which sport an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum in addition to its Zacks Rank #1 (Strong Buy).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Bull of the Day: General Motors (GM)
Sporting a Zacks Rank #1 (Strong Buy) General Motors (GM - Free Report) ) lands the Bull of the Day as there could be a nice amount of upside for the auto giant from its current levels.
Trading around $33 per share, General Motors stock is 24% from its 52-week highs with the company’s outlook more refreshing for investors at the moment.
To that point, General Motors was able to beat its top and bottom-line first-quarter expectations last Tuesday and raised its guidance in key areas. Driven by strong customer demand and increased operating efficiency, General Motors said it led the U.S. auto industry in retail and fleet deliveries, commercial deliveries, and truck sales.
This resulted in General Motors blasting Q1 earnings expectations by 35% with EPS at $2.21 per share compared to estimates of $1.64 per share. Year over year Q1 earnings were up 6% with sales jumping 11% from the prior year quarter at $39.98 billion. First-quarter sales also beat top-line estimates by 3%.
Image Source: Zacks Investment Research
EPS Revisions & EV Presence
Aforementioned, General Motors also raised its outlook during its quarterly report and now expects fiscal 2023 EPS between $6.35 -$7.35 per share ($11 billion-$13 billion) and up from previous guidance of $6-$7 per share ($10.5 billion- $12.5 billion).
In correlation, earnings estimate revisions have climbed for General Motors over the last week and this is a great sign GM stock could start rising. Fiscal 2023 earnings estimates increased 5% last week and have now gone up 14% over the last quarter. Plus, FY24 EPS estimates have continued to trend higher as well.
Image Source: Zacks Investment Research
More importantly, General Motors is starting to put an end to fears that Tesla (TSLA - Free Report) ) and other EV companies would diminish its presence in the auto industry. With an electric vehicle expansion of its own, General Motors delivered 20,000 EVs during the first quarter.
This was a quarterly record and almost doubled Ford’s (F - Free Report) ) 10,866 EV deliveries with General Motors surpassing its long-term rival for the #2 spot in the U.S. market share behind Tesla. General Motors said it increased its EV market share by 8% during Q1 to surpass Ford, and unlike Tesla will not cut prices and dip into profits which came as a delight to investors.
Image Source: Zacks Investment Research
Great Value
With earnings estimates on the rise, General Motors’ price-to-earnings valuation is very attractive at just 4.9X forward earnings. This is nicely beneath the industry average of 10.5X and the S&P 500’s 19.1X. Even better, General Motors stock trades 77% below its decade-long high of 22.8X and at a 22% discount to the median of 6.7X.
Image Source: Zacks Investment Research
General Motors’ cash flow is also attractive with the company raising its guidance for adjusted automotive free cash flow from expectations of $5 billion-$7 billion to $5.5 billion-$7.5 billion. Even better, when looking at General Motors’ price-to-cash flow its stock appears to have strong value right now.
With a lower P/CF number being desired many professional investors typically prefer this valuation metric because cash is harder to manipulate on the income statement and bolsters the financial health of a company.
At 2.9X, General Motors P/CF is intriguingly below the industry average of 9.2X and the benchmark’s 16.5X.
Image Source: Zacks Investment Research
Takeaway
Now appears to be an opportunistic time to buy General Motors stock with its attractive expansion in the EV market and the company offering good value to investors.
This is reason to believe there could be a considerable amount of upside in GM shares which sport an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum in addition to its Zacks Rank #1 (Strong Buy).