GM's Wall Street proof is here as it outperforms its peers in 2024

DETROIT — GM It is proving to be a standout among automakers this year as it continues to consistently beat Wall Street and its competitors' earnings expectations.

Shares of the Detroit automaker rose 54.7% before Monday's open, outperforming longtime rivals. Tesla And electric vehicle startups in the United States Lucid Collection and Rivian Cars.

“You may still not believe it, but it's true, GM keeps trucking,” John Murphy, a securities analyst at Bank of America, wrote in an investment note last month after the automaker beat Wall Street's expectations for the third quarter.

GM has done so with the help of $12.4 billion in stock buybacks since last November, which the automaker said will continue for the foreseeable future. But it's also proving to be better operationally than its crosstown rivals ford motor And parent company Chrysler Stellantisas well as their peers in other sectors.

Mary Barra, the company's CEO and president, has promoted this type of discrimination for years, but it has largely fallen on deaf ears. For the most part, GM stock trades in lockstep with Ford because of its history and the cyclical nature of the auto industry.

But not this year. Ford stock was down 10% as of Friday's close. Others, incl Ferrariwhich has been among the best-performing auto companies on Wall Street, also lags behind General Motors.

Even as Tesla shares rose more than 30% over the past week after President-elect Donald Trump won the US presidential election, the electric car maker continues to trail General Motors. Tesla CEO Elon Musk campaigned extensively for Trump.

General Motors (GM): 54.7% Ferrari (RACE): 34.3% Tesla (TSLA): 29.3% Hyundai Motor* (HYMTF): 27.9%BYD Company* (BYDDF): 27.2%toyota motor (TM): decreased by 6.2%. Ford (F): down 10%.Honda Motor (HMC): down 13.3% Volkswagen* (VWAGY): down 28.2%Nissan Motor* (Human): decreased by 36.1%.Lee Otto (LI): down 36.8% Stellantis (STLA): down 42.5%New Company (NIO): Down 43.9%, Lucid (LCID): Down 47.5%, Rivian (RIVN): Down 54.9%.
* Over-the-counter stocks

GM, unlike many competitors, has not cut its 2024 guidance or underperformed Wall Street's quarterly earnings expectations. Instead, it has already raised key financial targets despite facing persistent market challenges in the United States and its Chinese operations losing hundreds of millions of dollars amid increased competition.

While GM said it would cut costs, it did not have to be as aggressive as other automakers this year. Nissan, Volkswagen and Stellantis are undertaking massive business restructurings that include layoffs, production cuts and other cost-saving measures.

GM shares under Barra, who began leading the automaker in January 2014, have been lackluster for investors for most of her tenure. The average closing stock price during her tenure is $38 per share, lower than the closing stock price of $40.02 before she became CEO, according to FactSet data.

Cumulatively, as of Friday's close, shares were up 38.9% over the Barra period. This compares to a roughly 300% increase for the S&P 500 over that time frame. The highest GM stock price ever under Barra was $67.21 on January 5, 2022, as Barra presented GM's electric vehicle ambitions and growth plans.

It's not yet clear whether GM can continue its hot streak next year, but the automaker advised that it expects the company's performance in 2025 to be in line with this year, including pointing to a weaker fourth quarter.

Barra, when discussing quarterly earnings on October 22, reiterated its position that GM will continue to “build on our competitive strength and deliver performance that sets us apart from others in the industry.”

“We will be disciplined, we will be flexible, and we will make adjustments as much as we can to continue to drive growth and profitability,” Barra said. “In the coming weeks and months, you will see more clearly than ever how we intend to leverage the tailwinds within our control to deliver strong results in 2025 that are in a similar range to 2024.”

GM shares are an average of overweight with a price target of $59.85 per share, according to a Wall Street average of estimates compiled by FactSet.