GM Stock Value Drops 5 Percent During Week Of May 27 – May 31, 2019
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The value of GM stock decreased during the May 27th, 2019 – May 31st, 2019 timeframe. Shares closed the week at $33.34 per share, which represents a decrease of $1.78 per share, or 5 percent, compared to last week’s closing value of $35.12.
Movements in GM stock value for the week were as follows:
- Monday, May 27th: market closed in recognition of Memorial Day holiday
- Tuesday, May 28th: GM stock opened the day (and the week) at $35.20 and closed at $34.85
- Wednesday, May 29th: opened at $34.67 and closed at $34.79
- Thursday, May 30th: GM stock opened at $34.76 and closed at $34.82
- Friday, May 31st: General Motors stock opened at $33.39 and fell to $35.34 at market close
The decline in value experienced this week marks the fourth consecutive weekly drop for GM stock after four consecutive weeks of gains. Shares saw a weekly low of $33.15 (on Friday) and a weekly high of $35.34 per share (on Tuesday). As such, the value has remained below the $40 per share mark – which the stock has briefly surpassed five times so far this year. By comparison, shares of GM’s cross-town rival, the Ford Motor Company, fell by $0.31 per share.
We posit that the ongoing decline in GM stock value is caused by the prolonged trade war between the United States and China, which has intensified over the past few months. In addition, the Trump administration on Friday announced a surprise Mexico tariff threat, correlating to the precipitous GM stock sell-off that day. Tariffs and trade wars create a significant amount of uncertainty in global economies and markets, and stock markets typically react negatively to trade wars and uncertainty. The Dow Jones Industrial Average, for instance, decreased 13 percent during the week.
| Date | Open | Close | High | Low |
|---|---|---|---|---|
| 2019/5/31 | 33.39 | 33.34 | 33.7 | 33.15 |
| 2019/5/30 | 34.76 | 34.82 | 35.09 | 34.48 |
| 2019/5/29 | 34.67 | 34.79 | 34.845 | 34.32 |
| 2019/5/28 | 35.2 | 34.85 | 35.34 | 34.71 |
Over the last few years, GM has taken many steps to increase the value of its stock, including exiting markets where it can’t find ways to turn a profit (such as Europe, South Africa, and India), closing plants in various parts of the world, divesting loss-making divisions (such as Opel-Vauxhall), making adjustments to its business model in order to prioritize profitability over chasing market share goals, focusing on its Cadillac luxury brand to increase its share of high-profit automobiles, investing heavily into new-age mobility ventures such as electric vehicles and autonomous driving tech, while discontinuing some sedans (Cruze, Impala, LaCrosse, XTS) to focus on more profitable crossovers, SUVs, and pickup trucks.
The 2020 Cadillac XT6 is one of the all-new models meant to reinvigorate the Cadillac brand as part of GM’s strategy to increase the brand’s return
Despite these noteworthy actions, the value of GM stock has struggled to surpass the $40 mark, spending most of its time in the $33-$38 per share range. By comparison, the value of the “new GM’s” IPO was $33 per share in November 2010. The circumstance has had many investors frustrated.
GM Cruise AV prototype testing in October 2018
It will be interesting to see how GM stock performs during the rest of the year, especially as the Detroit-based automaker launches its GEM-based vehicles for developing markets, completes the roll-out of its full-size pickup trucks, begins to launch its all-new full-size SUVs and various new Cadillac models – all products that are expected to contribute significantly to its bottom line. In addition, the automaker is planning to roll out an autonomous ride-sharing service from its Cruise division by the end of 2019. GM sees it as a “trillion-dollar opportunity”, with Cruise AV division on track to launch the service in limited markets by the end of this year.
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We posit that the ongoing decline in GM stock value is caused by the prolonged trade war between the United States and China, which has intensified over the past few months.
You posit WRONG… has the mkt response with other companies been the same? Possibly, but it’s total utter and complete incompetence on the part of GM Mgt. The mkt response is everything they do is wrong… We’re witnessing GMs death by a thousand cuts… 100% and totally their own fault.
so you don’t like gm’s direction.
which car company do you like?
Overall, the market response was the same. Here is a quote from Dow Jones:
:The declines resulted in one of the worst Mays for stocks in years, with the Dow falling 6.7% while the large-cap index lost 6.6% and the Nasdaq declined 7.9%.”
Many comments about GM comes from their final assembly points for the vehicles. The Vehicles that are assembled in Mexico have components sourced from all over North America, China, Europe, etc. For example, regardless of final assembly; doesn’t GM’s plant in Romulus, Michigan supply transmissions for many of their vehicles regardless of final assembly point of the vehicle? And that is why the market dropped so much. Much manufacturing have components go back and forth from one country to another before final assembly. Final assembly in Mexico doesn’t mean that the internal components are made in Mexico.
All one has to do is look at ones 401K to see we’re down this month, considerably, but GM’s Stock has done absolutely nothing since it IPO’d. Thats a leadership issue..
can’t name a car company you’d rather park your money?
I am not critical of either Ford products or Ford management. But looking at the 5 year chart for Ford you will find that they closed at $17.41 on 8/29/14. Today, F closed at $9.61. Looking at the 5 year chart for GM, you will find that on 8/29/14 they closed at $34.80. Today, GM closed at $33.70.
Both stocks are considered undervalued by Morningstar. Both stocks have paid dividends during this time.