From other sites
at Zacks.com (Fri, 4:50PM)
at Zacks.com (Fri, 12:40PM)
at CNBC.com (Fri, 11:49AM)
at CNBC.com (Fri, 10:29AM)
at CNBC.com (Fri, 9:08AM)
at Zacks.com (Thu, 3:29PM)
at CNBC.com (Thu, 3:00PM)
at CNBC.com (Thu, 2:28PM)
at CNBC.com (Thu, 1:15PM)
at CNBC.com (Thu, 10:46AM)
- Falling gas prices should bode well for the company as consumers look to buy more fuel efficient vehicles.
- The company recently recalled an additional 316,000 vehicles for faulty headlamps.
- I will maintain a steady pace of purchasing as long as the stock is under $35.
- GM shares have suffered this year as investors worried about the implications of its recall woes.
- However, November sales were strong, and it is clear that consumers have not soured on the brand.
- Trading at 5x 2015 earnings ex-cash, GM is a compelling investment and should be bought.
General Motors' Profitability Is Dependent On A Highly Competitive Premium Car Market
- Sales began declining by the end of last year and through this year, resulting in the 10-month report for 2014 showing Cadillac sales down by 9.5% in the US.
- Vehicle recalls continue to haunt GM as the total number of outstanding recalls stand at 833,633 vehicles as of 20th November.
- Arizona’s attorney general announced that they had filed a $3.5 billion lawsuit against GM, claiming the company defrauded the state’s consumers by delaying recalls by up to a decade.
- With their most profitable segment taking a hit this year along with the hefty recalls, it seems like the company's net income will fall this year as well.
- With more lawsuits possibly being filed, and with long term prospects being uncertain, GM stocks might not be the best investment option at the moment.
- Recent monthly sales numbers blew away estimates.
- SUV sales gained traction in Q3 2014.
- Low gasoline prices could be a huge tailwind for 2015.
- It is time to review the Chevrolet Volt 1.0 after almost four years and over 40,000 miles driven.
- The all-new Volt 2.0 is just around the corner, with production starting next summer.
- The all-new Volt 2.0 should see dramatic cost reduction, with more parts common to other GM products such as the Cruze.
- GM lost money on Volt 1.0, but is only bringing the Volt 2.0 to market with profitability in mind.
- For GM’s shareholders, this will spell relief from having red ink subsidize mostly wealthier people in California's richest coastal ZIP codes.
- General Motors has had a rough year as the company has been pummeled by a huge recall crisis and losses in its European Operations.
- The shares have underperformed the overall S&P 500 by about 25% this year as a result.
- However, brighter days look ahead in the coming year. Investors should scoop up these cheap shares prior to the New Year as they are likely to outperform market in 2015.
High-Yielding General Motors Continues To Be A Deeply Discounted Stock
- The stock continues to be undervalued with respect to 2015 earnings estimates.
- The dividend payout ratio has decreased due to increased earnings.
- The company managed to increase its return on assets and equity from the prior quarter.
- In the following I will try to figure out what assumptions have to be met, to justify GM's stock price.
- The framework is a very simple DCF framework.
- Rather than pin an exact value on the company, my approach is to find reasonable ranges, for different outcomes.
- I find GM to be undervalued in all realistic scenarios.
General Motors: 3.7% Dividend Yield And 50% Appreciation Potential Make It A Buy
- GM offers a large margin of safety, strong appreciation potential and an attractive dividend yield.
- North American EBIT adjusted margins of 9.5% are up about 200 bps from when the company IPO’d.
- The company has made real strides in bolstering North American profitability and China has been a source of real strength.
- GM is not your mom and pop's car company any longer.
- The "new" General Motors seems to have succeeded in streamlining its business, and is putting out a much more quality product.
- I invest in this company as a speculative dividend growth bet, due to perceived limited downside after the recent sell-off.
Update: General Motors Still Down Despite Decent Q3 Earnings
- GM beat consensus on the bottom line but missed on the top line.
- The earnings beat confirms our opinion that GM is a solid long-term play on the global recovery.
- We have noted before that GM has impressive exposure to China which is a long-term positive.
Update: General Motors Drives Out Of The Recall Ditch With $0.97 In Adjusted EPS
- GM beat consensus estimates by $0.02, while increasing truck/SUV market share by 1.3%.
- Predictions that recalls would not hurt sales have been confirmed; European weakness broader and deeper than expected.
- GM continued at "Buy" on valuation and yield.
- General Motors and its shareholders have faced travails in 2014 due to the saga of a major recall crisis.
- However, given this headwind and challenges in Europe the company is delivering solid results.
- The fall in price represents a good opportunity as 2015 is shaping up to be a much better year for the company.
- The stock is cheap, pays a solid dividend, has huge free cash flow and has billionaire fund managers singing its praises as an investment recently.
Is It Safe To Reach For The Ignition Switch? GM In Q3
- Company leadership seems rather insulated from the recent spate of negative news surrounding the company.
- Long-term projects will increase the costs incurred in the short term, which will likely in turn hurt profit margins.
- Financials can be expected to remain at marginal-to-little growth over last year quarter.
- The whisper number is $0.98, one cent ahead of the analysts' estimate.
- GM has a 70% positive surprise history (having topped the whisper in 21 of the 30 earnings reports for which we have data).
- The overall average post earnings price move is 'negative' (beat the whisper number and see weakness, miss and see weakness) when the company reports earnings.
- GM is in the midst of a very tough year.
- Third quarter earnings could jump-start the stock into 2015 or send the stock even further down, below $30 per share.
- Analysts aren't expecting much growth at all and estimates have been revised downward.
- Three keys to focus on are margins, sales in Europe, and guidance.
- Shares of General Motors have fallen in light of the recalls but stronger sales have helped to support the company.
- Strong sales may be a result of recall customers coming into the dealerships and big discount programs - both unsustainable over the long-term.
- Not only are high sales numbers likely unsustainable, the company has had to issue stop-sell orders on many new models which may further hurt its reputation.
Yesterday, 5:58 PM
- Consumer spending in several areas is likely to benefit from lower pump prices, but J.P. Morgan's Ryan Brinkman thinks the auto industry may benefit more than most from consumers having more money to spend on all things apart from fuel.
- The analyst sees Goodyear Tire (NASDAQ:GT), American Axle (NYSE:AXL), GM and Ford (NYSE:F) - in that order - as best positioned to benefit, followed by suppliers with material exposure to full-size trucks and SUVs that is not as great as AXL, including Tenneco (NYSE:TEN), Lear (NYSE:LEA) and Tower International (NYSE:TOWR).
- Tesla (NASDAQ:TSLA) is an exception, however, as Brinkman sees a potential reduction in the terminal value of cash flows on his reduced outlook for Model 3 vehicles if fuel prices remain low longer-term.
Yesterday, 3:00 PM
- U.S. automobile sales are forecast to increase 11% in December to an annual selling rate of 16.6M units, according to a fresh forecast from TrueCar.
- The research firm says the industry benefited from lower gas prices and a better month of weather than was seen a year ago.
- For the full year, TrueCar expects total U.S. vehicle revenue to be up 8.3% to close to $1T.
- Transaction prices on new cars are up 1.9% to $31,831 YTD.
- Used vehicle sales are up 3.3% for the year.
- Related stocks: GM, F, TM, FCAU, HMC, OTCPK:NSANY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCQX:VLKAY, OTCPK:FUJHY, KMX, CRMT, AN, LAD.
Yesterday, 2:17 PM
- The age of connected cars appears closer with Google pushing forward with its next-gen Android M software designed to be integrated into automobiles.
- The industry has a bit of an uneasy relationship with Google, despite the company's open-source approach to the technology.
- Though most major automakers collaborate with Google through the Open Automotive Alliance - which aims for a common platform to drive innovation - the self-driving car initiative of Google and their own infotainment ambitions keep them wary.
- Analysts originally forecast vehicle-to-vehicle communication would be part of the connected car concept and be integrated into some models by 2016, although that timetable now appears unlikely.
- What to watch: Before any major breakthrough occurs, the DOT needs to weigh in on next-gen connected cars. That gets trickier with safety and security concerns teed up again after the high-profile GM recall debacle and crippling Sony hacking incident.
- Automaker stocks: GM, F, TM, HMC, OTCPK:NSANY, TSLA, OTCQX:VLKAY, OTCPK:DDAIF, OTC:HYMLF, OTCPK:BAMXY, OTCPK:MMTOF, OTCPK:PEUGF, OTC:RNSDF, TTM, OTCPK:MMTOF, OTCPK:SZKMY, OTCPK:FUJHY, OTC:RNSDF, OTCPK:GELYF, FCAU.
Thu, Dec. 18, 9:14 AM
- General Motors (NYSE:GM) suspends making deliveries to Russia due to the volatile situation with the ruble exchange rate.
- The company operates in the region through Opel-division GM Russia.
- Jaguar Land Rover (NYSE:TTM) and Audi (OTCQX:VLKAY) have also halted sales in the nation in reaction to the currency crisis.
- The above automakers - along with BMW (OTCPK:BAMXY), Daimler (OTCPK:DDAIF), Hyundai (OTC:HYMLF), and Renault (OTC:RNSDF) - face large hits in Q4 due to exposure to the Russian currency.
- Some estimates on ruble losses range over the $100M mark.
Tue, Dec. 16, 8:19 AM
- RBC Capital downgrades General Motors (NYSE:GM) to Sector Perform from Outperform.
- The investment firm cautions on general industry trends and specifically on the high sales and operating margin targets set by the Detroit automaker.
- What to watch: Pricing pressure in the U.S. could be on GM's plate in 2015 and Cadillac will have to deal with the onslaught of the German automakers on the continent.
- Related: Here come the German automakers.
- GM -1.4% premarket
Tue, Dec. 16, 7:10 AM
- General Motors (NYSE:GM) car registrations -11.9% to 62,908 units in November, according to the European Automobile Manufacturers Association.
- YTD registrations -4.2% to 838,433 units.
- Market share: 6.6% in November, 7.2% YTD.
- Results include the Opel, Vauxhall, Chevrolet, and other GM brands.
- EAMA release (.pdf)
Thu, Dec. 11, 5:54 PM
- General Motors (NYSE:GM) plans to double production capacity in Mexico over the next four years, according to officials.
- The automaker will spend about $3.6B on top of the $1.4B already invested over the last two years.
- Currently, GM makes about 890K motors and 1.2M transmissions a year at its four plants in the nation.
Mon, Dec. 8, 2:59 PM
- General Motors (GM -3.6%) has now approved 38 death claims linked to the ignition-switch issue.
- 51 claims which fall under a severe injury or hospitalization category have also been approved by the compensation administrator named by GM.
- The claim deadline is January 31, 2015.
- GM ignition compensation claim report (.pdf)
Mon, Dec. 8, 10:45 AM
- New data from Truecar.com indicates more than one million cars with a transaction price over $50K will be sold this year.
- Sales at the price point are up 30.8% through November compared to a year ago.
- Transactions for cars below the $50K level were up 4.1% for the same time period.
- Detroit automakers (GM, F, FCAU) have big plans for the Cadillac, Lincoln, and Fiat brands in the U.S. in 2015.
- Meanwhile, German automakers (OTCPK:DDAIF, OTCPK:BAMXY, OTCQX:VLKAY) are all increasing production capacity in the U.S. based on forecasts for strong high-end sales growth.
- Strong demand in the U.S. for cars priced over $50K also bodes well for Tesla Motors (NASDAQ:TSLA).
Mon, Dec. 8, 7:46 AM
- Detroit automakers (F, GM, FCAU) are likely to face an intense standoff with the UAW next summer as a new contract is negotiated amid an overall improved pace of sales in the industry.
- Labor:Though union workers have participated in the industry recovery through profit sharing arrangements, the UAW plans to ask for hourly wage increases across the board.
- Management: The Big Three will look to keep a two-tier wage system that allows them to hire workers at an entry level. The group has also learned from the painful mistakes it made in the past.
- What to watch: The UAW has a little more firepower in its back pocket with the ability to strike at Chrysler and GM with bailout restrictions gone.
Fri, Dec. 5, 4:42 AM| 19 Comments
Wed, Dec. 3, 10:54 AM
Wed, Dec. 3, 3:38 AM
- Toyota (NYSE:TM) is cutting 2,600 workers in Australia citing high production costs and a strong Australian dollar.
- The move is part of plans to stop producing cars in the country by 2018 and will bring its total workforce in the country to 1,300.
- Ford (NYSE:F) and General Motors (NYSE:GM) are planning similar departures in the next few years, knocking down the rank of Australia among auto-making nations.
- TM +1.1% AH
Tue, Dec. 2, 3:27 PM
- New car prices rose 1.7% Y/Y and 0.5% M/M to $33,754 in the U.S. during November for the 8 eight largest automakers, according to Kelley Blue Book.
- Average car price gain/loss (Y/Y): Fiat Chrysler Automobiles (NYSE:FCAU) +3.4% to $33,833; General Motors (NYSE:GM) +3.4% to $37,749; Hyundai (OTC:HYMLF) +3.3% to 424,913; Ford (NYSE:F) +2.6% to $35,832; Toyota (NYSE:TM) flat at $30,909; Honda (NYSE:HMC) -0.3% to $27,341; Nissan (OTCPK:NSANY) -1.0% to $28,652, Volkswagen (OTCQX:VLKAY) -3.7% to $38,556.
Tue, Dec. 2, 9:36 AM
- General Motors (NYSE:GM) unit sales +6.5% to 225,818 vs. +2.6% consensus estimate.
- GM had an average transaction price of $35,600 per unit in November, according to estimates. The mark is +2.3% M/M and +9.5% Y/Y.
- Fleet sales were up 11%.
- The automaker ended the month with 88 days supply of inventory, compared to 94 days last month.
Mon, Dec. 1, 4:55 PM
- General Motors (NYSE:GM) says it is recalling 316K older-model SUVs and sedans for a problem with malfunctioning headlamps.
- Affected vehicles are model years 2006-09 Buick LaCrosse sedans; 2006-07 Chevrolet Trailblazer, GMC Envoy and Buick Rainier SUVs; and 2006-08 Saab 9-7X and Isuzu Ascender SUVs.
- The newest recall brings to 30.4M vehicles worldwide and 26.8M vehicles in the U.S. that GM has recalled this year.
GM vs. ETF Alternatives
Other News & PR