Mizuho raises GM stock price target to $63 on strong earnings

Looking ahead, Mizuho (NYSE:MFG) analysts expect General Motors (NYSE:GM) to remain well-positioned as it enters 2025, due to its strong ICE portfolio and the anticipated improvements in EV profitability. The company is focusing on scaling EV production and enhancing profitability in the coming year, even as it anticipates moderate headwinds in the ICE segment, with pricing likely to decrease by 1.0-1.5% year-over-year. The company’s strong market position is reflected in its 57.7% price return over the past year and management’s commitment to shareholder returns through aggressive share buybacks and consistent dividend increases over the past three years. For comprehensive analysis of GM’s future prospects, investors can access the detailed Pro Research Report available on InvestingPro. The company’s strong market position is reflected in its 57.7% price return over the past year and management’s commitment to shareholder returns through aggressive share buybacks and consistent dividend increases over the past three years. For comprehensive analysis of GM’s future prospects, investors can access the detailed Pro Research Report available on InvestingPro.

Looking ahead, Mizuho analysts expect General Motors to remain well-positioned as it enters 2025, due to its strong ICE portfolio and the anticipated improvements in EV profitability. The company is focusing on scaling EV production and enhancing profitability in the coming year, even as it anticipates moderate headwinds in the ICE segment, with pricing likely to decrease by 1.0-1.5% year-over-year. The company’s strong market position is reflected in its 57.7% price return over the past year and management’s commitment to shareholder returns through aggressive share buybacks and consistent dividend increases over the past three years. For comprehensive analysis of GM’s future prospects, investors can access the detailed Pro Research Report available on InvestingPro.

Mizuho analysts pointed to several positive aspects of GM’s earnings report, including better-than-expected EBIT from GM International (GMI) aided by positive equity income from China. Additionally, electric vehicle (EV) deliveries for the quarter were notably strong, with 44,000 units delivered, marking a 126% increase from the previous year and accounting for about 5% of GM North America’s deliveries. This performance was underscored by the company’s announcement that its EV volumes have started to yield a "positive variable profit."

Despite the positive developments, GM stock experienced a slight downturn on Tuesday. This was attributed to projections for flat or modestly lower year-over-year internal combustion engine (ICE) volumes for 2025, and the forecast of approximately 300,000 EV wholesales, which would represent about 5% of the overall mix. These factors suggest potential downside risks to profitability, despite the overall positive outlook.

Looking ahead, Mizuho analysts expect General Motors to remain well-positioned as it enters 2025, due to its strong ICE portfolio and the anticipated improvements in EV profitability. The company is focusing on scaling EV production and enhancing profitability in the coming year, even as it anticipates moderate headwinds in the ICE segment, with pricing likely to decrease by 1.0-1.5% year-over-year.

In other recent news, General Motors (GM) has declared a quarterly cash dividend of $0.12 per share, continuing a trend of dividend growth over the past three years. This announcement comes amidst GM’s ongoing efforts to transition to an all-electric future, with significant investments in electric vehicle (EV) technology and infrastructure. JPMorgan maintains an Overweight rating on GM, despite adjusting the company’s earnings estimates for 2025 and 2026 downward due to expected changes in U.S. EV pricing. On the production front, GM’s North American and Chinese operations have exceeded expectations, contributing to a predicted fourth-quarter EPS of $2.06.

In collaboration with GM, SAIC Motor Corp. anticipates a significant drop in profits for 2024, largely due to a writedown of GM’s joint venture in China and an ongoing price war. Meanwhile, Cadillac, a GM division, has announced the production of the 2026 Cadillac LYRIQ-V, its fastest EV to date, set to begin in early 2025. In regulatory developments, the Federal Trade Commission (FTC) has taken action against GM and its subsidiary OnStar for allegedly collecting and selling consumer data without proper consent. Lastly, a report from the Consumer Financial Protection Bureau (CFPB) indicates a rise in auto repossessions surpassing pre-pandemic levels, highlighting growing consumer risk in the auto loan market. These are recent developments that investors should keep an eye on.

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