General Motors Company ($GM) Earnings (Q3 FY22)

 General Motors Company ($GM) Earnings and Opinion:


GM is a company in the Consumer Cyclical sector and operates in the Auto Manufacturers industry. The company designs, builds, and sells trucks, crossovers, cars, and automobile parts and accessories in North America, the Asia Pacific, the Middle East, Africa, South America, the United States, and China. GM was founded in 1908 and is headquartered in Detroit, Michigan. The company made its debut on the stock market in 2010.

General Motors Earnings Results:

  • Revenue of $41.89B missing expectations of $42.37B
  • Adj Operating Income of $4.29B beating expectations of $3.48B
  • Free Cash Flow of $4.59B beating expectations of $3.4B
  • Adj Diluted EPS of $2.25 beating expectations of $1.89
Opinion:
General Motors had some positive sentiment in todays trading session. The company reported earnings before the market opened this morning. General Motors rode its strong sales for luxury Cadillacs and large trucks to a nice earnings beat. This is a huge indicator than rising interest rates may have not hit the businesses yet. One of the biggest keys to a nice revenue was the availability of semiconductors to the company. Surprisingly, GM saw a nice improvement in business within China, even with shutdowns. The companies self-driving unit, Cruise, has lost a lot of this year. However, GM is riding this bet to try and get autonomous technology and robotaxi service. The overall earnings report showed some positive signs to investors. Profitability was an overall hit, with some pretty nice beats on both EPS and Adjusted Operating Income. The Free Cash Flow is also a nice sign to some cash being on hand and could be used to expand on its investments or reinvestment back into its EV unit. As far as valuation goes, the company seems to be a little undervalued. The P/E ratio sits at 5.96, which is less than the median of 7.89. The EV?EBITDA is also pretty low at 2.39. P/FCF is at 6.64, which is lower than the median of 10.74. In my opinion, GM seems to be headed in the right direction. The EV market has ramped up and its all about who can produce the best EV. GM looks to be one of the leaders and heading in the right direction, while Ford seems to be going in the wrong direction. The company has some solid investments lined up and are relying a lot on the future of its EV. GM is one that I am betting on and one that I hold. I am long GM $GM.


*Information from Bloomberg and Yahoo Finance

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