General Motors (GM) is gearing up to release its third-quarter financial results on Tuesday, and the spotlight is expected to be firmly on the company’s electric vehicle (EV) progress. Analysts are predicting solid revenue and earnings growth for the quarter, and GM is likely to use this platform to showcase its advancements in the EV space.
Earnings Estimates and Analyst Sentiment:
Analysts are anticipating General Motors to report revenue of $44.59 billion for the third quarter, a slight increase from the $44.13 billion reported in the same period last year. This would mark the company’s ninth consecutive quarter exceeding revenue expectations. Earnings per share (EPS) are projected to reach $2.43, a rise from $2.28 in the previous year’s third quarter. The company has a strong track record of beating EPS estimates, having surpassed expectations in eight of the last ten quarters. Notably, General Motors raised its full-year EPS outlook to a range of $9 to $10 after its second-quarter earnings, reflecting two consecutive quarters of increased estimates.
However, the analyst sentiment surrounding GM stock is mixed. Some analysts are cautious about the company’s inventory buildup in the U.S., which could potentially lead to price pressure in 2024. Concerns have also been raised regarding GM’s EV progress, with some suggesting that the company may not reach its EV sales targets. Analysts like Bernstein’s Daniel Roeska have downgraded their ratings, citing these factors as potential challenges to future growth.
EV Sales and Future Models:
General Motors reported strong third-quarter vehicle deliveries, with 659,601 units sold in the U.S., representing a 2% decline from the previous year. However, the company achieved record EV sales during the quarter, with 32,095 units sold, a significant increase of 60% year-over-year and 46% quarter-over-quarter. This growth was driven by strong demand for models like the Equinox EV and Silverado EV.
While GM’s individual EV models may trail rivals like Ford and Tesla in terms of sales, the company’s overall EV sales are strong, placing them second in the U.S. market behind only Tesla. GM executives have emphasized their focus on providing an EV option for a wide range of consumers, contributing to their market success.
Investors will be keen to hear about GM’s plans for upcoming EV models, particularly the 2025 Cadillac Escalade IQ and 2025 Cadillac Optiq. The company may also provide insights into the more affordable Silverado EV, which is expected to launch later this year and could compete directly with Ford’s F-150 Lightning pickup truck.
China Strategy and Market Performance:
General Motors could provide a more detailed update on its strategy in China, where it aims to return to profitability. China is a key market for automotive companies, and GM’s progress in this region will be closely watched.
GM Stock Performance:
General Motors shares have experienced significant growth in 2024, rising 35% year-to-date. The company’s focus on EV production and its commitment to expanding its EV portfolio appear to be driving investor confidence.
Tuesday’s earnings call is expected to provide crucial insights into General Motors’ financial performance, its strategic direction, and the company’s long-term outlook in the evolving automotive landscape.