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General Motors (GM) Recalls 800K Trucks for Faulty Steering

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Per Reuters, General Motors Company (GM - Free Report) is recalling roughly 800,000 pickup trucks, worldwide. The recall includes 2014 models of Chevrolet Silverado 1500 as well as GMC Sierra 1500 that could lead to loss of power steering.

Per company reports, the 2014 model trucks can come across as a temporary loss of power steering, majorly during low-speed turning maneuvers. The recall includes vehicles of approximately 690,000 from the U.S., 80,000 of Canada and approximately, 25,000 vehicles from other markets, globally.

The recalled vehicles’ software will be reflashed in order to address the defect.

General Motors Company Price and Consensus

Of late, General Motors has been recalling vehicles in large numbers. In Sep 2016, the company recalled nearly 4.3 million vehicles worldwide after detecting a software defect which prevented air bags from deploying during a crash. Also, the Takata airbag issue earlier in May 2016 had recalled 1.9 million vehicles, which further expanded by an additional 600,000 trucks in Jun 2016. These recalls impose an extra burden of costs on the company.

Price Performance

General Motors’ shares have inched up 0.4% in the last six months, thus substantially underperforming the 5.7% increase of the industry it belongs to.

Zacks Rank & Key Picks

General Motors currently carries a Zacks Rank #3 (Hold).

Some better-ranked automobile stocks are Fox Factory Holding Corp. (FOXF - Free Report) , Cummins Inc. (CMI - Free Report) and Ferrari N.V. (RACE - Free Report) , all currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Fox Factory has a long-term growth rate of 15.9%.

Cummins has an expected long-term earnings-per-share growth rate of 12.1%.

Ferrari has an expected earnings growth rate of 14.1% over the long term.

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