Sick of Tesla and Looking for a Climate Trade? Think General Motors
Tesla's meteoric rise over the last couple of years has disconnected the company's share price from its fundamental value, in my view. Consider that Tesla is still a barely profitable company whose market capitalization exceeds all other major US, European, and Japanese auto companies combined. What's more, Tesla's sales are just 1/50th of the other major automakers.
Enter General Motors (GM), which announced late last week they were setting a goal of 2035 for phasing out gasoline- and diesel-powered vehicles, which is a huge deal for GM -- vehicles that run on fossil fuels make up approximately 98% of GM's total sales. The announcement is a monumental shift in the company's long-term strategy, and sets it up to compete with Tesla in the decades to come.
The available market share for EV sales is still very much up for grabs -- about 2.2 million EVs were sold globally in 2020, which made up a mere 3% of overall auto sales. Imagine a time when 50% of all auto sales are EVs! Who will be selling the most vehicles then?
GM's decision comes at a time when the market is pushing corporations towards climate-friendly policies and emissions-conscious production. GM took a big step last week in saying it wants to be a long-term player.
So which stock does Tickeron's A.I. like the most now? Below, A.I.dvisor runs analytics on both stocks side by side, with actionable trade ideas.
GM in upward trend: price rose above 50-day moving average on October 07, 2024
GM moved above its 50-day moving average on October 07, 2024 date and that indicates a change from a downward trend to an upward trend. In of 29 similar past instances, the stock price increased further within the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 09, 2024. You may want to consider a long position or call options on GM as a result. In of 83 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for GM just turned positive on October 09, 2024. Looking at past instances where GM's MACD turned positive, the stock continued to rise in of 45 cases over the following month. The odds of a continued upward trend are .
The 10-day moving average for GM crossed bullishly above the 50-day moving average on October 11, 2024. This indicates that the trend has shifted higher and could be considered a buy signal. In of 13 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where GM advanced for three days, in of 329 cases, the price rose further within the following month. The odds of a continued upward trend are .
GM may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In of 220 cases where GM Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.
Fundamental Analysis (Ratings)
Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 74%.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. GM’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. GM’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 86, placing this stock better than average.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.815) is normal, around the industry mean (6.019). P/E Ratio (6.202) is within average values for comparable stocks, (18.031). Projected Growth (PEG Ratio) (0.846) is also within normal values, averaging (5.553). GM has a moderately low Dividend Yield (0.009) as compared to the industry average of (0.043). P/S Ratio (0.362) is also within normal values, averaging (76.807).
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Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a manufacturer of cars, trucks and automobile parts
Industry MotorVehicles