General Motors (GM) is one of the world’s largest automakers, selling nearly 8 million vehicles per year. The company builds and sells cars, trucks, crossovers, and automobile parts worldwide.
GM was founded in 1908 and operates through GM North America, GM International, Cruise, and GM Financial segments. General Motors ‘s shares fell through support on fears of the coronavirus Covid-19 pandemic environment but the recent sell-off created an attractive opportunity to invest into this stock.
At its current share price, General Motors could be an excellent long-term investment with a very generous yield and solid growth prospects. With the market cap of $31.37 billion, this is one of the most under-valued companies according to analysts. GM is well-positioned to outperform peers in the brutal auto industry environment because of its scale, clout, logistical expertise, and focus.
The company’s revenue decreased in 2019 to $122.697 billion from $133.045 billion in 2018 but the growth projects will ensure that the numbers will be moving up in the future. It is also important to mention that the net income in 2019 was $6.7 billion while the net income in 2018 was $8.01 billion. GM reported recently that it will suspend its dividend and buybacks to preserve cash for investing in the business which is not bad news in this coronavirus environment.
Another important information for potential investors is the fact that Berkshire Hathaway increased its position in GM by 37% in 2018 and by 4% in 2019. With 75 million shares, Berkshire Hathaway is General Motors’ fifth-largest investor, holding more than 5% of the car company’s shares outstanding.
When we take a look at the one-year chart, we can see that the price dropped from $42 to $15 and started to raise. On this chart, I marked resistance and support levels. Supports levels are $20 and $15, $30, and $34 represent the resistance levels.
If the price jumps above $30 it would be a “BUY” signal and we have the open way to $34. Rising above $40 supports the continuation of the bullish trend overview efficiently for the upcoming period. If the price falls, every price in a range from $15 – $20 could be a very good opportunity to invest in General Motors.
Conclusion: General Motors Co. (GM) A Worthy Invesment?
Shares of GM, overall, appear to be a very good investment option, with Wall Street analysts expecting its price to rise considerably in the next several years. General Motors’s shares fell through support on fears of the coronavirus Covid-19 pandemic environment but the recent sell-off created an attractive opportunity to invest in this stock. The majority of the metrics point to this investment being highly attractive.
