GM Stock Leads Auto Industry Upside: Analysts Predict Major Growth Over Rivals Including Tesla

Auto analysts from BofA Global Research see more upside in General Motors Co‘s GM stock than other major auto OEM players.

GM stock offers 165% upside from current levels, according to BofA analyst John Murphy. Murphy’s price objective for GM is $75, based on an EV/EBITDAP multiple of 4x on 2024 estimates.

According to Murphy, this valuation is justified due to the timing of the cycle and GM’s core business being well-managed.

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Future-proofing the business with autonomous electric vehicle fleets and connectivity may provide upside. Downside risks include a downturn in U.S. auto sales, rising input costs, supply disruption, gas price increases, deteriorating new vehicle pricing, market share losses, unwilling dealers to shoulder inventory risk, suppliers gaining pricing power, capital market stress, and key management departures.

On the other hand, upside risks include continued U.S. auto cycle strength, robust growth in China, favorable mix and pricing, and capital allocation towards shareholder returns.

Based on their analysis of auto companies following Q3 2023 earnings, BofA analysts see GM stock as the most undervalued among other auto OEM players. The research firm’s report indicated:

• 165% upside for General Motors with a price target of $75
• 141% upside for Rivian Automotive Inc RIVN with a price target of $40
• 84% upside for Ford Motor Co F with a price target of $19
• 68% upside for Lucid Group Inc LCID with a price target of $7
• 23% upside for Ferrari NV RACE with a price target of $456
• 22% upside for Tesla Inc TSLA with a price target of $290

It’s worth noting that the analysts view Tesla stock offering the least upside from current levels.

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