June 12, 2019

GM – Market expectations are for Uniform ROA compression, but management is confident in Cadillac, cost management, and South American business


  • General Motors Company (GM:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 13.6x Uniform P/E, implying bearish expectations for the firm. However, management is confident in their Cadillac sales, cost management, and South American business turnarounds
  • Specifically, management is confident in their Cadillac XT4 sales to new clients, ability to manage costs, and the advantages of their brands, partnerships, and new vehicles. Moreover, they are confident in their ability to generate returns and turn around their business in South America, despite macro volatility.
To read this Embedded Expectations Analysis report in its entirety, please log into the Valens Research web app. If you don't have an account, you can sign up for the 30-day trial.