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Investing.com - Bernstein SocGen Group has raised its price target on General Motors (NYSE:GM) stock to $41.00 from $36.00 while maintaining an Underperform rating. The stock currently trades at $53.73, with a notably low P/E ratio of 8.52x, according to InvestingPro data.
The firm cited improved clarity on tariff impacts for the price target increase, though it expressed concerns about GM’s North American operations, which are under pressure from $1.1 billion in tariffs while electric vehicle operations return to cash-burning status.
GM reported second-quarter adjusted earnings per share of $2.53, exceeding consensus estimates by 8%, with group EBIT coming in 5% above expectations and revenues beating forecasts by nearly $2 billion.
Despite the overall beat, Bernstein noted that GM’s core North American business missed EBIT expectations by 7.5%, with margins declining 150 basis points quarter-over-quarter, suggesting underlying structural weakness rather than strength. InvestingPro analysis reveals weak gross profit margins of 10.97%, though the company maintains a strong free cash flow yield of 29%. Get access to 8 more exclusive InvestingPro Tips and comprehensive valuation metrics with an InvestingPro subscription.
The automaker has resumed share buybacks and maintained its full-year guidance, though Bernstein questioned GM’s ability to meet both EBIT and free cash flow targets without significant tariff mitigation or investment reductions.
In other recent news, General Motors reported impressive second-quarter 2025 earnings, with earnings per share (EPS) of $2.53, surpassing Wall Street’s forecast of $2.35. The company also achieved $47.1 billion in revenue, exceeding expectations of $45.81 billion. Despite these positive results, analysts have adjusted their price targets for the automaker. TD Cowen lowered its price target to $80, citing "noisier than expected" results, but maintained a Buy rating, considering GM a "Top Pick." Benchmark also held its Buy rating with a $65 price target, noting GM’s EPS beat its estimate but highlighting challenges from tariffs and warranty expenses. Meanwhile, Citi raised its price target to $61, emphasizing GM’s leverage to positive trade agreements and the company’s strategies to mitigate tariff impacts. BofA Securities reduced its price target to $62, maintaining a Buy rating, and mentioned the absence of full mitigating actions on tariffs in the quarter. These developments reflect the ongoing analysis and varied perspectives among analysts regarding GM’s financial performance and strategic positioning.
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