GM rebounds with US$8b profit on strong pricing

Andrew Cummings
February 8, 2019

Meanwhile, net income attributable to shareholders was reported at $2.1 billion (or $1.40 per share) during the fourth quarter compared with a loss of $5.2 billion (or $3.65 per share) in the year-ago period, when it took a one-time charge associated with the U.S. tax code reform.

General Motors Co. displays the new Chevrolet 2020 Silverado HD pickup truck at the GM Flint Assembly Plant in Flint, Michigan, U.S. February 5, 2019.

How do GM's Q4 results compare to other automaker stocks?

GM reported a fourth-quarter loss in 2017 to adjust for an overhaul of the USA tax system. Here's what GM did in 2018, compared with what Wall Street expected: *Adjusted earnings: $1.43 per share vs. $1.22 per share estimated *Revenue: $38.4 billion vs. $36.48 billion expected GM shares were up 1.8 percent Wednesday morning after rising almost 4.8 percent in premarket trading. Finally, Gradient Investments LLC lifted its holdings in shares of General Motors by 89.7% during the fourth quarter. Capital Investment Advisors LLC boosted its stake in General Motors by 2.3% during the fourth quarter. Kingstown Capital Management L.P. now owns 1,600,000 shares of the auto manufacturer's stock valued at $53,872,000 after buying an additional 100,000 shares during the period. MML Investors Services LLC increased its holdings in General Motors by 67.4% in the 3rd quarter. Quadrant Capital Group LLC now owns 3,432 shares of the auto manufacturer's stock worth $101,000 after acquiring an additional 458 shares in the last quarter. First Hawaiian Bank now owns 9,142 shares of the auto manufacturer's stock worth $306,000 after purchasing an additional 524 shares during the last quarter. Following these latest developments, around 0.70% of Square, Inc. stocks are owned by institutional investors and hedge funds.

Shares of GM rose 1.4 percent. The company has a quick ratio of 0.76, a current ratio of 0.89 and a debt-to-equity ratio of 1.75.

The price-earnings ratio (P/E ratio) is the ratio for valuing a company that measures its current share price relative to its per-share earnings. General Motors has a twelve month low of $30.56 and a twelve month high of $45.00. The auto manufacturer reported $1.43 EPS for the quarter, topping the consensus estimate of $1.21 by $0.22.

EBIT-adjusted margin of 8.0% was down 0.8 percentage points. Greenwood Gearhart Inc. grew its holdings in General Motors by 7.1% during the 4th quarter.

The company said strong pricing on pickup trucks and crossover SUVs in North America drove results, though the sales drop in China, the world's largest auto market, during the quarter hurt the bottom line by about $200 million.

GM Financial generated 2018 full-year earnings before tax (EBT) of $1.9b, up 58.3% compared to 2017, on revenue of $14bn.

The company is also in the midst of a plan to cut 14,000 jobs. Stockholders of record on Friday, March 8th will be issued a dividend of $0.38 per share. This represents a $1.52 dividend on an annualized basis and a yield of 3.84%. General Motors's dividend payout ratio is now 22.96%. Morgan Stanley advised investors in its research note published on August 17th, 2018, to Overweight the GM stock while also putting a $46 price target. Zacks Investment Research raised shares of General Motors from a "sell" rating to a "hold" rating in a report on Tuesday, October 9th.

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