CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We increase our 12-month price target by $2 to $30, based on a ’25 P/E of 4.2x, a steep but justified discount to historic averages. We increase our 2023 adjusted EPS estimate by $0.50 to $8.00, keep 2024 at $6.65, and introduce ’25 at $7.15. GM posts Q3 adjusted EPS of $2.28 vs. $2.25 (+1%), well ahead of the $1.84 consensus. The beat was driven by a stronger-than-expected top line, as revenue rose 5.4% to $44.13B ($880M above consensus) on stronger volumes (+5.2%). GM withdrew its prior 2023 adjusted EPS guidance of $7.15-$8.15 (current consensus = $7.49) due to uncertainty related to the UAW’s now 40-day-old targeted strike. GM also said it will moderate its EV production ramp-up for a variety of reasons, which we believe is a prudent move. While a deal with the UAW will eventually be struck, it is likely to put GM and the Detroit Three at an even greater labor cost disadvantage relative to Tesla and non-domestic automakers. After the stock’s recent underperformance, we raise our rating one notch to Hold.