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Investing.com - Citi has raised its price target on General Motors (NYSE:GM) stock to $61.00 from $59.00 while maintaining a Buy rating, citing the automaker’s significant leverage to positive trade agreements. The automotive giant, currently valued at $47 billion, trades at a modest P/E ratio of 7.65, suggesting potential undervaluation according to InvestingPro analysis.
The investment bank noted that GM reported better-than-expected second-quarter earnings despite facing adverse impacts from higher tariffs and regulatory uncertainty. The company, generating $188.45 billion in revenue over the last twelve months, has demonstrated resilience in challenging conditions. According to Citi, GM’s current guidance assumes existing tariff levels will continue, but the company believes it can mitigate 30% of the impact through capacity realignment, pricing adjustments, and cost reduction measures.
Citi highlighted recent developments in trade negotiations, referencing a CNN report from Tuesday that Japan and the United States had reached a trade agreement. This deal could potentially open the Japanese market to U.S. vehicle imports and might incentivize other countries to accelerate their own trade solutions.
The bank specifically mentioned that progress with USMCA or South Korea would be positive catalysts for GM and could lead to upward revisions in financial assumptions.
Citi concluded that General Motors has "the most leverage to positive trade agreements of any stock in our coverage universe," supporting its decision to increase the price target while maintaining its Buy recommendation. This aligns with the broader analyst sentiment, with price targets ranging from $34 to $83 per share.
In other recent news, General Motors reported strong financial results for the second quarter of 2025, surpassing Wall Street expectations. The company achieved an earnings per share (EPS) of $2.53, higher than the forecasted $2.35, and generated $47.1 billion in revenue, exceeding the anticipated $45.81 billion. Despite these positive results, the stock experienced a decline, attributed to investor concerns over broader market conditions and strategic challenges. Additionally, BofA Securities adjusted its price target for General Motors, lowering it to $62.00 from $65.00, while maintaining a Buy rating. BofA described the quarter as "respectable," noting that full mitigating actions could eventually reduce the tariff impact by more than 30%. These developments reflect the ongoing adjustments and strategic considerations facing General Motors.
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