GM stock took quite a beating roughly a month ago, when it reported its second quarter 2018 earnings and lowered its forecast by roughly $1 billion in profit as a result of higher commodity prices, which GM has said was not the result of trade tariffs. The stock then briefly recovered some of its value, but is back to tumbling once again.
Shares of the General Motors Company, as traded on the NYSE, closed at $36.13 on August 22nd, 2018 – down $0.79 or 2.11 percent. The value is fast approaching its 52-week low of $34.50.
The “New GM” went public in 2010 at $33 a share, then went on to hit $39.48 per share, until tumbling to $21.78 a share – all in the first 12 months of the Initial Public Offering in 2010. The current value represents a 9 percent increase over the IPO value. But during the same timeframe, the S&P 500 Index has grown over 170 percent. In other words, GM shares have significantly lagged the index.
But the circumstance is not without hope, as the automaker is looking for several initiatives to boost value and, as a result, share price in the near- to medium-term future. The initiatives include the commercialization of its Cruise autonomous vehicle department as well as newfound profits from the Cadillac luxury division, which has been revitalized in recent years and is planning to launch its bigger product offensive in history.
Here’s to hoping that the efforts have a sizable and tangible impact on the share price that bring it in line with the market.