General Motors (GM) Gains As Market Dips: What You Should Know
General Motors (GM) closed the most recent trading day at $36.75, moving +0.85% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.08%. Meanwhile, the Dow gained 0.06%, and the Nasdaq, a tech-heavy index, lost 0.07%.
Prior to today's trading, shares of the automaker had lost 8.03% over the past month. This has lagged the Auto-Tires-Trucks sector's loss of 4.92% and the S&P 500's gain of 0.52% in that time.
Wall Street will be looking for positivity from GM as it approaches its next earnings report date. The company is expected to report EPS of $1.14, down 20.28% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $35.43 billion, down 1.87% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $6.48 per share and revenue of $146.94 billion, which would represent changes of -0.92% and -0.07%, respectively, from the prior year.
Any recent changes to analyst estimates for GM should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. GM is currently a Zacks Rank #2 (Buy).
Looking at its valuation, GM is holding a Forward P/E ratio of 5.62. This represents a discount compared to its industry's average Forward P/E of 10.15.
It is also worth noting that GM currently has a PEG ratio of 0.63. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Automotive - Domestic stocks are, on average, holding a PEG ratio of 1.09 based on yesterday's closing prices.
The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 22, putting it in the top 9% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow GM in the coming trading sessions, be sure to utilize Zacks.com.
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