Cautious Hold on General Motors Amid Tariff and Pricing Pressures

General Motors (GM – Research Report), the Consumer Cyclical sector company, was revisited by a Wall Street analyst today. Analyst Elizabelle Pang from DBS maintained a Hold rating on the stock and has a $45.50 price target.

Elizabelle Pang’s rating is based on several critical factors impacting General Motors’ current and future performance. One of the primary concerns is the recent implementation of a 25% tariff on auto imports into the United States, which significantly affects GM due to its substantial import volume. This tariff exposure is expected to impact GM’s top-line sales, as the company is one of the most exposed automakers to this new policy. Additionally, GM’s weakening pricing power in the North American market limits its ability to transfer these increased costs to consumers, further straining its financial outlook.
Moreover, Elizabelle Pang has noted potential downside risks to GM’s management guidance, especially since the current estimates do not fully account for the tariff’s impact. The company’s adjusted EBIT margins are projected at the lower end of management’s guidance, indicating potential financial strain. Despite GM’s strong position in the full-size trucks market and its investments in vehicle electrification and autonomous driving technology, these positive aspects are overshadowed by the immediate challenges posed by the tariffs and pricing pressures. Consequently, Elizabelle Pang maintains a Hold rating with a reduced target price of USD 45.50, reflecting a cautious stance on GM’s near-term prospects.

In another report released on March 20, Piper Sandler also maintained a Hold rating on the stock with a $48.00 price target.

Based on the recent corporate insider activity of 33 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of GM in relation to earlier this year.