General Motors Shares Gain After Earnings, Results Seen as Better-than-feared
2022.04.27 15:56
General Motors (GM) Shares Gain After Earnings, Results Seen as Better-than-feared
General Motors (NYSE:GM) reported better-than-expected Q1 adjusted EPS and raised its adjusted FY EPS forecast, driving its shares up 2% in premarket trading.
The automaker reported Q1 adjusted EPS of $2.09, compared to the consensus estimates of $2.25 in the year-ago period and above analyst expectations of $1.68.
Net sales and revenue totaled $35.98 billion, missing the consensus estimates of $37.31 billion.
Cruise net sales and revenue came in at $26 million, in line with the expected $26.1 million. Automotive net sales and revenue came in at $32.82 billion, below the estimated $34.15 billion.
GM said it sold 831,000 units in the quarter.
Moving forward, the carmaker expects FY 2022 net income to be in the range of $9.6 billion to $11.2 billion and reaffirmed its full-year outlook for adjusted EBIT of $13 billion to $15 billion.
BofA analyst John Murphy says that favorable price and mix fueled better-than-feared results.
“We are encouraged by the strong execution in the quarter despite ongoing macroeconomic pressure, and are largely maintaining our forward estimates and PO [of $95],” Murphy said in a client note.
Wedbush analyst Daniel Ives lowered the price target to $50.00 from $85.00 as results showed supply chain issues are “the black cloud” over GM. He added that results were “better than feared but clearly nothing to write home about.”
“Our bullish thesis for GM is predicated on the Detroit stalwart’s ability to convert 20% of its installed base by 2025 and 50%+ to EVs by 2030 which will result in a metamorphosis of its valuation in the eyes of the Street. As evidenced last night the EV strategy is progressing well with its massive investment profile continuing to elevate in this EV arms race with cross-town rival Ford also trying to share the EV spotlight. That said, we view this transition period as noisy but see the forest through the trees on an EV transformation thesis,” Ives said in a note.
By Senad Karaahmetovic
