A month has gone by since the last earnings report for General Motors (GM). Shares have lost about 2.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is General Motors due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
General Motors reported fourth-quarter 2024 adjusted earnings of $1.92 per share, which surpassed the Zacks Consensus Estimate of $1.85. The bottom line also increased from the year-ago quarter’s level of $1.24. Higher-than-expected revenues from GM North America (GMNA), GM International (GMI) and GM Financial segments led to the outperformance. Revenues of $47.71 billion beat the Zacks Consensus Estimate of $44 billion and increased from $42.98 billion recorded in the year-ago period.
The U.S. auto giant recorded adjusted earnings before interest and taxes (EBIT) of $2.51 billion, higher than $1.76 billion in the prior-year quarter. The automaker’s share in the GM market was 8.5% in the reported quarter, the same as the year-ago quarter.
GMNA generated net revenues of $39.53 billion, up from $35.23 billion recorded in the corresponding period of 2023. The figure also outpaced our model’s projection of $35.86 billion on higher-than-expected deliveries. Wholesale vehicle sales in the GMNA unit totaled 876,000 units, up from 782,000 units reported in the year-ago quarter. The figure also surpassed our estimate of 787,000 units. The segment’s adjusted EBIT totaled $2.27 billion, up from $2.01 billion recorded in the year-earlier period. The metric, however, missed our estimate of $2.88 billion.
GMI's net revenues in the reported quarter amounted to $3.99 billion, up from the year-ago quarter’s $3.94 billion. The metric also exceeded our expectation of $3.52 billion. The segment’s wholesale vehicle sales of 163,000 units increased from 161,000 units in the year-ago quarter and also exceeded our forecast of 145,000 units. GMI reported an operating profit of $221 million, down from $269 million generated in the year-ago period.
GM Financial generated net revenues of $4.11 billion in the quarter, which increased from $3.74 billion recorded in the year-ago period and surpassed our prediction of $3.81 billion. The segment recorded an EBIT-adjusted operating profit of $719 million, up from $707 million recorded in the year-ago period. The metric, however, missed our prediction of $737.3 million.
GM Cruise recorded net revenues of $181 million in the fourth quarter compared with $25 million recorded in the corresponding quarter of 2023. Our model estimate was $25.3 million. The segment posted an operating loss of $418 million, much narrower than a loss of $792 million reported in the prior-year quarter. The reported loss was wider than our estimate of a loss of $410.6 million.
General Motors had cash and cash equivalents of $19.87 billion as of Dec. 31, 2024. The long-term automotive debt at the end of the quarter was $13.29 billion. Net automotive cash provided by operating activities amounted to $4.77 billion during the quarter under review. The company recorded an adjusted automotive free cash flow of $1.82 billion in the fourth quarter of 2024, up from $1.34 billion generated in the year-ago quarter.
GM declared its fourth-quarter dividend of 12 cents per share. The dividend will be paid out on Mar. 20 to shareholders of record as of Mar. 7, 2025.
For 2025, GM expects adjusted EBIT in the range of $13.7-$15.7 billion compared with $14.9 billion recorded in 2024. Adjusted EPS is anticipated in the range of $11-$12 compared with $10.60 recorded in 2024. Adjusted automotive free cash flow is expected in the band of $11-$13 billion compared with $14 billion recorded in 2024.
It turns out, fresh estimates flatlined during the past month.
Currently, General Motors has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
General Motors has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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This article originally published on Zacks Investment Research (zacks.com).
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