Zacks Investment Research Lowers General Motors (GM) to Sell

Zacks Investment Research downgraded shares of General Motors (NYSE:GM) (TSE:GMM.U) from a hold rating to a sell rating in a report issued on Tuesday, January 2nd.

According to Zacks, “The Zacks Consensus Estimate of General Motors’ quarterly earnings estimate has been going down of late. The company has been facing high levels of passenger car inventory that will affect the short-term liquidity in periods of low sales. Also, high costs and unfavorable currency translation effects has forced the company to scale down or shut its manufacturing operations in some regions. Moreover, General Motors has been recalling vehicles, which is increasing its expenses and hampering the customers confidence in the brand.”

Other research analysts have also issued research reports about the company. Evercore ISI lifted their target price on General Motors from $40.00 to $41.38 in a report on Friday, December 29th. UBS Group reaffirmed a buy rating and set a $50.00 target price (up previously from $39.00) on shares of General Motors in a report on Wednesday, October 11th. Citigroup reissued a buy rating and set a $53.00 price objective on shares of General Motors in a report on Monday, October 9th. Instinet reissued a buy rating and set a $43.00 price objective on shares of General Motors in a report on Tuesday, October 3rd. Finally, Bank of America raised General Motors from a neutral rating to a buy rating and upped their target price for the stock from $40.00 to $57.00 in a research note on Tuesday, October 3rd. Four analysts have rated the stock with a sell rating, twelve have assigned a hold rating, eleven have issued a buy rating and two have assigned a strong buy rating to the company. The stock presently has an average rating of Hold and a consensus price target of $43.80.

General Motors (GM) traded up $1.18 during midday trading on Tuesday, reaching $44.19. 8,900,000 shares of the company traded hands, compared to its average volume of 12,960,000. General Motors has a twelve month low of $31.92 and a twelve month high of $46.76. The company has a current ratio of 0.94, a quick ratio of 0.79 and a debt-to-equity ratio of 1.54. The firm has a market cap of $62,770.00, a P/E ratio of 9.56, a P/E/G ratio of 0.82 and a beta of 1.55.

General Motors (NYSE:GM) (TSE:GMM.U) last released its earnings results on Tuesday, October 24th. The auto manufacturer reported $1.32 EPS for the quarter, topping the Zacks’ consensus estimate of $1.07 by $0.25. General Motors had a return on equity of 20.95% and a net margin of 2.00%. The company had revenue of $30.48 billion for the quarter, compared to analysts’ expectations of $29.93 billion. During the same period in the previous year, the business posted $1.72 EPS. The business’s revenue for the quarter was down 16.6% compared to the same quarter last year. sell-side analysts anticipate that General Motors will post 6.25 EPS for the current fiscal year.

The business also recently disclosed a quarterly dividend, which was paid on Thursday, December 21st. Stockholders of record on Friday, December 8th were paid a $0.38 dividend. This represents a $1.52 annualized dividend and a dividend yield of 3.44%. The ex-dividend date of this dividend was Thursday, December 7th. General Motors’s dividend payout ratio (DPR) is currently 32.90%.

In related news, insider Barry L. Engle II sold 50,443 shares of General Motors stock in a transaction that occurred on Monday, December 4th. The stock was sold at an average price of $43.08, for a total transaction of $2,173,084.44. Following the sale, the insider now owns 57,091 shares of the company’s stock, valued at approximately $2,459,480.28. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Nysschen Carel J. De sold 123,645 shares of General Motors stock in a transaction that occurred on Friday, October 27th. The shares were sold at an average price of $44.59, for a total value of $5,513,330.55. Following the sale, the executive vice president now directly owns 150,484 shares in the company, valued at approximately $6,710,081.56. The disclosure for this sale can be found here. Insiders sold 552,298 shares of company stock worth $24,408,137 in the last ninety days. Corporate insiders own 0.04% of the company’s stock.

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Peapack Gladstone Financial Corp grew its holdings in General Motors by 2.7% during the 2nd quarter. Peapack Gladstone Financial Corp now owns 6,428 shares of the auto manufacturer’s stock valued at $225,000 after buying an additional 166 shares in the last quarter. Regal Investment Advisors LLC grew its holdings in General Motors by 6.9% during the 2nd quarter. Regal Investment Advisors LLC now owns 6,187 shares of the auto manufacturer’s stock valued at $216,000 after buying an additional 397 shares in the last quarter. Wesbanco Bank Inc. grew its holdings in General Motors by 7.0% during the 2nd quarter. Wesbanco Bank Inc. now owns 7,636 shares of the auto manufacturer’s stock valued at $266,000 after buying an additional 500 shares in the last quarter. Dorsey & Whitney Trust CO LLC grew its holdings in General Motors by 6.9% during the 2nd quarter. Dorsey & Whitney Trust CO LLC now owns 8,257 shares of the auto manufacturer’s stock valued at $288,000 after buying an additional 535 shares in the last quarter. Finally, Veritable L.P. grew its holdings in General Motors by 1.0% during the 2nd quarter. Veritable L.P. now owns 61,892 shares of the auto manufacturer’s stock valued at $2,162,000 after buying an additional 619 shares in the last quarter. Institutional investors and hedge funds own 73.01% of the company’s stock.

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About General Motors

General Motors Company designs, builds and sells cars, trucks, crossovers and automobile parts. The Company’s segments include GM North America (GMNA), GM Europe (GME), GM International Operations (GMIO), GM South America (GMSA) and General Motors Financial Company, Inc (GM Financial). The Company provides automotive financing services through General Motors Financial Company, Inc The Company develops, manufactures and/or markets vehicles in North America under the brands, including Buick, Cadillac, Chevrolet and GMC.

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