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Will General Motors (GM) Snap Earnings Beat Streak in Q1?
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General Motors (GM - Free Report) is slated to release first-quarter 2022 results on Apr 26, after market close. The Zacks Consensus Estimate for the quarter’s earnings and revenues is pegged at $1.57 per share and $36.34 billion, respectively.
The Zacks Consensus Estimate for General Motors’ first-quarter earnings per share has been revised downward by 10 cents over the past 60 days. The bottom-line projection indicates a year-over-year decline of 30.2%. The top-line estimate, however, implies year-over-year growth of 11.9%.
In the last reported quarter, GM topped earnings estimates on better-than-expected profits from the North America and Financial segments. In fact, over the trailing four quarters, the company topped the Zacks Consensus Estimate on all occasions, with the average being 46.5%. This is depicted in the graph below:
While investors are keeping their fingers crossed for GM to retain its earnings beat streak in first-quarter 2022 as well, our model does not predict the same.
Things to Consider
General Motors’ U.S. sales came in at 512,846 vehicles in the first quarter, down 20% from the comparable year-ago period. Escalating supply chain issues — aggravated by the Russia-Ukraine war — kept a lid on vehicle supply despite robust demand. High commodity costs, a tough labor market and logistical challenges are also likely to have played spoilsports.
On a somewhat positive note, high average prices of vehicles amid tight inventories are anticipated to have partially offset the decline in vehicle deliveries. The Zacks Consensus Estimate for General Motors’ Q1 revenues from the North America unit is pegged at $34,263 million, indicating an increase from $25,957 million generated in the year-ago period. Yet, high operating expenses are anticipated to have weighed on segmental margins. The consensus mark for General Motors’ operating profit from the GMNA segment is pegged at $2,422 million, implying a decline of 22.7% on a year-over-year basis.
In China, General Motors delivered more than 613,000 vehicles, down from 780,000 units in first-quarter 2021. The downside stemmed from persistent chip shortage and COVID-19 resurgence.
In the last earnings call, General Motors provided a gloomy 2022 outlook for the GM Financial unit, which raises a concern regarding Q1 results. The Zacks Consensus Estimate for operating profit from the GM Financial unit is pegged at $850 million, down from $1,182 million recorded in the corresponding quarter of 2021. Discouragingly, the consensus mark for the GM Cruise unit’s operating loss stands at $335 million, indicating a deterioration from the loss of $259 million incurred in the year-ago period.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for General Motors this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here
Earnings ESP: It has an Earnings ESP of -6.37%. This is because the Most Accurate Estimate of $1.47 per share is pegged 10 cents lower than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: General Motors currently carries a Zacks Rank of 4 (Sell).
While an earnings beat looks uncertain for General Motors, here are a few stocks in the auto space, which, according to our model, have the right combination of elements to post an earnings beat for the quarter to be reported:
Allison Transmission (ALSN - Free Report) has an Earnings ESP of +10.35% and a Zacks Rank #3. The stock is set to report first-quarter 2022 earnings on Apr 27.
The Zacks Consensus Estimate for Allison’s to-be-reported quarter’s earnings and revenues is pegged at $1.16 per share and $642 million, respectively. Encouragingly, ALSN surpassed earnings estimates in the last four quarters, with an average of 13.4%.
LKQ Corp (LKQ - Free Report) has an Earnings ESP of +0.37% and a Zacks Rank #3. The stock is set to report first-quarter 2022 earnings on Apr 28.
The Zacks Consensus Estimate for LKQ’s to-be-reported quarter’s earnings and revenues is pegged at 91 cents per share and $3.28 billion, respectively. Encouragingly, LKQ surpassed earnings estimates in the last four quarters, with an average of 33.9%.
Cummins, Inc. (CMI - Free Report) has an Earnings ESP of +1.68% and a Zacks Rank #3. The stock is set to report first-quarter 2022 earnings on May 3.
The Zacks Consensus Estimate for Cummins’ to-be-reported quarter’s earnings and revenues is pegged at $3.55 per share and $6.02 billion, respectively. Over the trailing four quarters, CMI surpassed earnings estimates twice for as many misses, with an average surprise of 0.5%.
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Will General Motors (GM) Snap Earnings Beat Streak in Q1?
General Motors (GM - Free Report) is slated to release first-quarter 2022 results on Apr 26, after market close. The Zacks Consensus Estimate for the quarter’s earnings and revenues is pegged at $1.57 per share and $36.34 billion, respectively.
The Zacks Consensus Estimate for General Motors’ first-quarter earnings per share has been revised downward by 10 cents over the past 60 days. The bottom-line projection indicates a year-over-year decline of 30.2%. The top-line estimate, however, implies year-over-year growth of 11.9%.
In the last reported quarter, GM topped earnings estimates on better-than-expected profits from the North America and Financial segments. In fact, over the trailing four quarters, the company topped the Zacks Consensus Estimate on all occasions, with the average being 46.5%. This is depicted in the graph below:
General Motors Company Price and EPS Surprise
General Motors Company price-eps-surprise | General Motors Company Quote
While investors are keeping their fingers crossed for GM to retain its earnings beat streak in first-quarter 2022 as well, our model does not predict the same.
Things to Consider
General Motors’ U.S. sales came in at 512,846 vehicles in the first quarter, down 20% from the comparable year-ago period. Escalating supply chain issues — aggravated by the Russia-Ukraine war — kept a lid on vehicle supply despite robust demand. High commodity costs, a tough labor market and logistical challenges are also likely to have played spoilsports.
On a somewhat positive note, high average prices of vehicles amid tight inventories are anticipated to have partially offset the decline in vehicle deliveries. The Zacks Consensus Estimate for General Motors’ Q1 revenues from the North America unit is pegged at $34,263 million, indicating an increase from $25,957 million generated in the year-ago period. Yet, high operating expenses are anticipated to have weighed on segmental margins. The consensus mark for General Motors’ operating profit from the GMNA segment is pegged at $2,422 million, implying a decline of 22.7% on a year-over-year basis.
In China, General Motors delivered more than 613,000 vehicles, down from 780,000 units in first-quarter 2021. The downside stemmed from persistent chip shortage and COVID-19 resurgence.
In the last earnings call, General Motors provided a gloomy 2022 outlook for the GM Financial unit, which raises a concern regarding Q1 results. The Zacks Consensus Estimate for operating profit from the GM Financial unit is pegged at $850 million, down from $1,182 million recorded in the corresponding quarter of 2021. Discouragingly, the consensus mark for the GM Cruise unit’s operating loss stands at $335 million, indicating a deterioration from the loss of $259 million incurred in the year-ago period.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for General Motors this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here
Earnings ESP: It has an Earnings ESP of -6.37%. This is because the Most Accurate Estimate of $1.47 per share is pegged 10 cents lower than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: General Motors currently carries a Zacks Rank of 4 (Sell).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks With Favorable Combination
While an earnings beat looks uncertain for General Motors, here are a few stocks in the auto space, which, according to our model, have the right combination of elements to post an earnings beat for the quarter to be reported:
Allison Transmission (ALSN - Free Report) has an Earnings ESP of +10.35% and a Zacks Rank #3. The stock is set to report first-quarter 2022 earnings on Apr 27.
The Zacks Consensus Estimate for Allison’s to-be-reported quarter’s earnings and revenues is pegged at $1.16 per share and $642 million, respectively. Encouragingly, ALSN surpassed earnings estimates in the last four quarters, with an average of 13.4%.
LKQ Corp (LKQ - Free Report) has an Earnings ESP of +0.37% and a Zacks Rank #3. The stock is set to report first-quarter 2022 earnings on Apr 28.
The Zacks Consensus Estimate for LKQ’s to-be-reported quarter’s earnings and revenues is pegged at 91 cents per share and $3.28 billion, respectively. Encouragingly, LKQ surpassed earnings estimates in the last four quarters, with an average of 33.9%.
Cummins, Inc. (CMI - Free Report) has an Earnings ESP of +1.68% and a Zacks Rank #3. The stock is set to report first-quarter 2022 earnings on May 3.
The Zacks Consensus Estimate for Cummins’ to-be-reported quarter’s earnings and revenues is pegged at $3.55 per share and $6.02 billion, respectively. Over the trailing four quarters, CMI surpassed earnings estimates twice for as many misses, with an average surprise of 0.5%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.