Is It Worthwhile For Investors To Follow These Insider Trades On General Motors Company (GM)?

General Motors Company (NYSE:GM) finished Wednesday with a subtraction of -$1.19 to close at $57.77, a downside of -2.02 percent. An average of 23,661,020 shares of common stock have been traded in the last five days. There was a gain of $3.84 in the past week. The last 20 days have seen an average of 20,278,119 shares traded, while the 50-day average volume stands at 19,025,172.

GM stock has increased by 13.85% in the last month. The company shares reached their 1-month lowest point of $48.37 on 09/20/21. With the stock rallying to its 52-week high on 06/07/21, shares of the company touched a low of $30.95 and a high of $64.30 in 52 weeks. In spite of this, the price is down -10.16% from the 52-week high.

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Insider Transactions

125 days have passed since General Motors Company (GM) last reported insider trading activity. Tsien Matthew, who is Executive Vice President, most recently acquired $192,986 shares at $62.83 per share on Jun 11. In this transaction, the insider spent $12,125,310. Executive Vice President & CIO, MOTT RANDALL D, disposed of 6,000 shares at a price of $64.01 on Jun 09. The insider now owns more than $384,060 worth of shares. Prior to that, Executive Vice President Tsien Matthew went on to Sale 16,989 shares at $63.95 each on Jun 07. An amount of $1,086,447 was transacted.

Valuation Metrics

General Motors Company (GM) has a trailing price-to-earnings (P/E) ratio of 6.68, which compares with the 15.45 for the broader industry and 31.09 for the sector. In the last five years, General Motors Company’s PE ratio has ranged between 63.03 and 3.579. The stock’s beta is 1.24. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 0.58, the price-to-book (PB) ratio at 1.62, and the price-to-cash flow ratio at 3.89.

The company’s most recent quarterly dividend payment was $0.38 a share, without any change from last year.

The quick ratio of General Motors Company for the three months ended June 29 was 0.90, and the current ratio was 1.10, indicating that the company is not able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 1.48 and a total debt to equity ratio of 2.15 for the quarter ending June 29. On the profitability front, the trailing 12-month gross margin is 15.40% against a 5-year average of 11.2%. General Motors Company’s EBITDA margin for the year ending June 29 is 16.34%, while its operating margin for the same period stands at 9.60%. Its gross profit as reported stood at $13.67 billion compared to revenue of $122.48 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, General Motors Company’s return on assets was 5.30%, compared to 2.4% over the last five years. In the past year, the return on investment has been 3.10%, and the 5-year average is 4.2%. Meanwhile, the return on equity (ROE) for the past 12 months has been 26.70% and the 5-year average holds at 13.0%. For the broader industry, ROE averaged 10.14 over the past year.

Earnings Surprise

For the three-month period that ended June 29, General Motors Company had $6.21 billion in cash. The analyst consensus anticipated General Motors Company’s latest quarter earnings to come in at $2.23 per share, but it turned out to be $1.97, a -11.70% surprise. For the quarter, EBITDA amounted to $5.9 billion. Shareholders own equity worth $1.45 billion.

Technical Picture

From a technical analysis perspective, let’s take a brief look at General Motors Company (GM) price momentum. RSI 9-day as of the close on 13 October was 69.62%, suggesting the stock is Neutral, with historical volatility in this time frame at 30.77%.

As of today, GM’s price is $57.97 +7.12% or $3.84 from its 5-day moving average. GM is currently trading +11.48% higher than its 20-day SMA and +1.85% higher than its 100-day SMA. However, the stock’s current price level is -0.19% below the SMA50 and +38.67% above the SMA200.

The stochastic %K and %D were 87.08% and 90.42%, respectively, and the average true range (ATR) was 1.72. With the 14-day stochastic at 79.34% and the average true range at 1.62, the RSI (14) stands at 67.48%. The stock has reached 2.14 on the 9-day MACD Oscillator while the 14-day reading was at 3.33.

Analyst Ratings

Wedbush launched coverage on General Motors Company (NYSE: GM) in its analyst report released on July 09, 2021. The firm assigned the stock a an Outperform rating.The consensus rating for General Motors Company (GM) among analysts is Buy. According to current brokerage recommendations, 0 brokerage firms advise that investors sell GM, while 3 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 1 analysts, while 21 others rate it as a “buy”.

What is GM’s price target for the next 12 months?

Analysts predict a range of price targets between $53.00 and $90.00, with a median target of $72.15. Taking a look at these predictions, the average price target given by analysts for General Motors Company (GM) stock is $72.92.


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