GM Stock Gets Pummeled After Automaker Lowers Guidance14
General Motors Company stock took a beating Wednesday and Thursday after the automaker lowered guidance for the rest of the year as it reported second quarter earnings.
GM shares ended Wednesday off 4.6 percent, representing the biggest one-day percentage plunge since November 2011. The stock lost another 2.4 percent Thursday.
Prior to the the earnings report, GM shares closed on Tuesday (July 24th) at $39.48, and closed on Thursday (July 26th) at $36.75, losing 7.4 percent in the 48 hour-long period. After-hours trading on Thursday saw shares gain less than a percent to $36.78.
The lowest that GM shares were valued in the past 12 months was $34.76, in August 2017.
General Motors revealed that costlier raw materials and unfavorable exchange rates in Brazil and Argentina will negatively impact its earnings in 2018, costing the company $1 billion in profit. The automaker has trimmed its profit outlook for the year, adjusting earnings to about $6 per share for 2018. Earlier this year, it forecast earnings in line with last year’s figure, which was $6.62.
During Q2 2018, General Motors’ pretax profit fell 13.3 percent to $3.2 billion. The automaker’s North American operations – by far its biggest and most profitable, was hit more than any of its other regional divisions.
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I expect we will see more talks and a pull back of the tariff issues. That will resolve much.
Short term pain for long term gain.
what exactly is that long term gain you envision?
gm going to start selling significant number of vehicles in europe? they already tried that.
how about japan? good luck.
china? they already sell lots there. it would be nice if they didn’t have to go dutch and transfer intellectual property. that would be good. but then again you might have a loud mouthed chinese leader start complaining about foreign brands. then having a local partner wouldn’t be a bad thing.
if things don’t get resolved soon, will trump start dishing out welfare checks to gm just like the farmers?
GM doesn’t make money in China. Revenue is diluted by 50% and they lose their intellectual property by getting raped repeatedly. Almost all profit is in N.A.
That is just it GM is making money even with the BS they deal with. The market is growing that fast.
Note too they only share technology they want to share, that is why some of their most advanced programs are not sold there.
Also China will steal most of it anyways with nearly 35 years of unchecked thef.
Last time I looked at their financials, over 80% of their profits came from North America despite selling more cars in China.
The only thing that China has any interests in is electrification. They already have everything else.
Scott3, read this. You may change your mind. A communist party official essentially told GM to hand it over or “Leave China”. GM bent over and the story went quiet. This goes on quietly daily with every Western company.
EVERY TIME I POST A LINK ON THIS SITE, MY COMMENT DOESN’T GET POSTED.
WILL TRY SEPERATELY
Is it a coincidence that the CT-6 is made there?
Big picture brother.
More equal markets and more competitive raw material prices.
You focuse too much on the bug on the wall and forget about the entire house.
Take steel. New plants here are being fired up. More equal footing between companies will bring global competitiveness that will help drive down cost.
In creating these jobs with the new plants you create more consumers with money to spend.
So GM even not going anywhere can benefit right here at home.
Like so many on the left they want to micro manage things into the ground. The real gains are made like cells splitting. As long as you do not go in and do some thing that kills off the growth the cells grow and touch many areas with expansion.
Making money in the auto industry is not just about selling cars. That is only 1/3 of the picture.
The others are MFG and development. Lower the cost here you increase profitability.
The reality is only China is showing great growth. So to seek future profits you must learn to make the products more cost effective in mfg them.
GM has taken great strides here and that is why they have stock prices near $40 while Ford has a hard time hitting $10.
Remember narrow mind narrow view.
GM will adjust pricing to offset the rise in cost! Problem solved. It’s not like GM is the only automaker dealing with this problem.
But nevermind that Tesla hasn’t made a profit…well, ever. Every quarter the announce they failed to meet their targets, as is tradition, and their stock dips for about 3 seconds before going back up.
Ford went below $10! Is it a buy? Brand preference aside… Looking to enter the stock market lol
To be honest there is some risk but even if Ford fails the sale of the Ford truck line would bump the stock up for a sale.
You may not lose your money but the question is when will they get cost inline and see growth of their value.
The risk is you may not see much gain anytime soon. That money could go where the chance of gain is greater.
I have time I’m only 24.