Saturday, May 31, 2025

Latest

General Motors Reports Solid 1Q 2022 Results, An Unusual Development In The Current Market

In a marked departure from the trends and factors which caused the earnings of a variety of companies to disappoint this earnings season, General Motors Company (NYSE: GM) reported solid 1Q 2022 earnings results on April 26. More precisely, the company demonstrated significant pricing power and reasonably good cost controls in the quarter which allowed the company to boost its adjusted diluted EPS guidance range for 2022 by US$0.25 to US$6.50 – US$7.50.

Importantly, neither inflation nor supply chain issues derailed the quarter as one may have expected. In addition, the company’s CEO Mary Barra reiterated that GM has a sufficient supply of semiconductors that will allow it to build 25%-30% more vehicles in 2022 than 2021 — despite an 18% decline in vehicle production in 1Q 2022 versus the year-ago period.

GM offset the lower unit sales in 1Q 2022 with significant price increases in the quarter. According to Cox Automotive, GM’s average transaction price in North America increased 14% in 1Q 2022 compared with 1Q 2021.

GM’s Chevrolet Silverado EV pickup truck has drawn impressive level of interest from consumers. The truck, commercial production of which begins in early 2023, already has 140,000 combined (refundable) fleet and retail reservations, up from around 110,000 at year-end 2021. To put that figure in perspective, Rivian Automotive, Inc. (NASDAQ: RIVN) has about 83,000 combined reservations (as of March 8, 2022) for its R1T electric pickup truck and R1S SUV.

GM’s balance sheet is solid.  Its cash and marketable securities total US$26.3 billion, while its Automotive debt is US$16.9 billion.

(in millions of US $, except for EPS and shares outstanding)1Q 20224Q 20213Q 20212Q 20211Q 2021
Automotive Revenue$32,823$30,349$23,424$30,744$29,067
Operating Income$2,196 ($1,898)$1,645 $2,882 $3,277 
Diluted EPS$1.35$1.35$1.62 $1.90 $2.03 
Operating Cash Flow$2,104$6,809($49)$7,162 $1,266 
Cash$26,256$28,676$23,940 $29,131 $29,380 
Automotive Debt$16,892$16,818$17,022 $17,318 $17,552 
Shares Outstanding (billions)1.51.51.51.51.5

It is of course possible that GM will not meet its ambitious 2022 vehicle production goals; the second half of 2022 will have to be very strong to do so. Also, GM’s future chip supplies might not be as certain as the company contends. 

General Motors shares, which trades at a P/E ratio of only 5.4x (based on the midpoint of company guidance), look inexpensive. The stock shares have plummeted ~40% since early January. Given its valuation and solid 1Q 2022 operating performance it is difficult to see the stock declining much more — despite the recent difficult stock trading environment in which investors have shown little tolerance for risk of any kind.  

General Motors Company last traded at US$38.94 on the NYSE.


Information for this briefing was found via Edgar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Leave a Reply

Video Articles

How To Profit From $3300 Gold? An Inside Look At A Massive 300,000 Oz Project | Martino De Ciccio

We’re At The Start of a Great Silver Boom | Ross McElroy & Andy Bowering – Apollo Silver Corp

Equinox Gold Q1 Earnings: When Everything Goes Wrong

Recommended

ESGold Begins Concentration Tests Ahead Of First Production

Sterling Metals Hits 0.21% Copper Over 482.8 Metres In First Drilling At Soo Copper project

Related News

GM to Invest $800 Million Towards Commercial EV Factory in Ontario

GM recently unveiled a new wholly-owned business called BrightDrop, which will provide electric first-to-last mile...

Tuesday, January 19, 2021, 10:32:00 AM

It’s Nearly 2021; Where’s My Flying Electric Car?

Auto hasn’t been a growth sector for quite some time. It’s been dominated by mature,...

Saturday, November 7, 2020, 08:30:00 AM

GM’s Cruise to Debut Driverless Taxis in 2022

General Motors’ (NYSE: GM) autonomous car subsidiary Cruise plans to debut its driverless taxi service...

Friday, December 10, 2021, 02:49:00 PM

General Motors: Analysts Expect Q2 Revenues Of $30.9 Billion

General Motors (NYSE: GM) will be reporting its second quarter financial results before the market...

Tuesday, August 3, 2021, 03:58:00 PM

Is The New Tax Law About To Make US Lithium Companies Hot?

US-based electric vehicle makers are finding ways to accelerate the creation of a US battery...

Monday, September 19, 2022, 03:05:00 PM