The General Motors Dip is an Opportunity

Investors may want to buy the dip in General Motors (SYM: GM).

Over the last few days, GM fell from about $50 to $44.50, where it’s now technically oversold.

However, much of the downfall appears to be an overreaction to earnings. Granted, the company did post a profit of $4.4 billion on ESP of $3.06, as compared to expectations of $3.9 billion on EPS of $2.71. Plus, management raised its forecast for full-year operating profits to a range with a midpoint of $14 billion from $13.5 billion year over year.

Unfortunately, investors got upset with how much the midpoint range was increased by.

In fact, according to Bank of America, the stock overreacted to the “size of the increase in the forecast for operating profit. The guidance was only raised by about $500 million, the amount by which the second-quarter earnings exceeded expectations,” as noted by Barron’s.

With that, investors may want to take advantage of the dip.

Other analysts are, including Citi, which just raised its GM earnings estimates and target price following the overreaction. The firm now has a buy rating on GM with a target of $98. “We don’t see any concerns or implications to 2025 and believe GM’s [second half] outlook understandably/expectedly embeds conservatism/cushion ahead of the October [investor day],” they added.

Again, based on an overreaction, consider buying the GM dip.

deal of the month

best growth stocks

Alliance

Bundle package – lifetime subscriptions for all products

Categories

Recent posts

Tags

Connect with Us

Get FREE Daily Stock Tips

Join and receive market insider stock picks, trade alerts and unique investing insights
This field is for validation purposes and should be left unchanged.
By clicking the "Subscribe" button you are accepting our Terms of Use and Privacy Policy.

Join Waitlist

We’re sorry, but due to the popularity of our services, we have reached our max number of subscribers and are not currently accepting more. If spots become available, we will be sure to contact you. Please join the waitlist below.
Thank You!

"*" indicates required fields

Name*
This field is for validation purposes and should be left unchanged.