GM’s ‘Time to Shine’ Approaches as Results Defy Global Decline

(Bloomberg) -- General Motors Co. shares jumped as much as 3.9% in New York on Thursday after results topped expectations, amid a tough global climate for automotives. However, the difficulties are far from over, with Jefferies saying the free cash flow outlook still looks challenging, while Buckingham flagged concerns about GM's market share.

Read more: GM Profit Beats Estimates as Trucks Make Up for Slower Sales

Here's a round up of initial analyst commentary after the results.

Evercore ISI, Chris McNally

“The alarm clock may be softly ringing for GM to finally re-awaken from its trading range slumber… second half into 2020 should be their time to shine.”

“Over the next 6-12 months, investors will now see potential for 2020 EPS upside to consensus of 15%-20%, increasingly supported by free cash flow conversion of over 70%.”

Maintained outperform, price target $44.

Jefferies, Philippe Houchois

“GM beating consensus by almost 20% and reiterated guidance although free cash flow guide still looks challenging to us.”

Maintained hold, price target $38.

Buckingham, Joseph Amaturo

“GM's EPS came in better than expected on the back of better-than-expected GMNA results, partly offset by weaker results overseas, resulting in lower company EBIT year over year.”

“Looking ahead, we remain concerned with the U.S. auto cycle, both from a pricing and volume perspective. Moreover, specific to GM, we are concerned about recent monthly pick-up truck and market share stats.”

“We would expect the stock to back-off throughout the day.”

Maintained neutral, price target $35.

To contact the reporter on this story: Esha Dey in New York at edey@bloomberg.net

To contact the editors responsible for this story: Brad Olesen at bolesen3@bloomberg.net, Morwenna Coniam

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