Shares of General Motors Co. (NYSE: GM) are on an upswing, following positive comments from analysts at JPMorgan Chase & Co. (NYSE: JPM) and Barclays Plc (NYSE: BCS).
The sentiment is nearly unanimous, as just 40 days after trading in the new firm began, analysts at Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), Royal Bank of Canada and Credit Suisse Group AG also advised buying shares of GM. After filing for bankruptcy protection and receiving loans from the government to continue operations, the firm’s management has quickly reshaped the firm. Free from the cumbersome debt that once saddled the automaker; the Detroit based behemoth has incurred a solid rebound. Investors have also given it a vote of confidence, which allowed the firm to raise more than $20 billion through an initial public offering of common and preferred shares last month.
Michelle Krebs, a senior analyst at Edmunds.com commented on a Bloomberg Television interview with Pimm Fox that “Sales may rise to 12.9 million in the U.S. next year.” Walter Todd, who helps manage about $900 million at Greenwood Capital Associates in Greenwood, South Carolina, said in a telephone interview that “As the economy improves, the auto market will pick up and investors are going to boost exposure in the industry.”
As GM shares trade in the $35 range, there appears to be significant upside potential. Of 14 analysts surveyed by Bloomberg, 10 have a “buy” rating on the shares, and four rate GM “hold.” The average target price is $43.45, according to Bloomberg data.
