General Motors Co.’s (NYSE: GM) fourth-quarter profit surged amid growth in China and booming sales of pickup trucks and sport-utility vehicles in the U.S., capping a record year for the nation’s largest auto maker.
GM reported $6.3 billion in net income attributable to common stockholders in the final three months of 2015, or $3.92 a share, up from $1.1 billion, or $0.66 a share, a year earlier.
Fourth-quarter earnings per share adjusted for special items were $1.39, up 17% from $1.19 a share a year earlier. The results beat Wall Street expectations of $1.21 a share.
North America sales rose 8.6% in the quarter, as gasoline prices falling below $2 a gallon and low interest rates kept consumers flocking to higher-margin trucks and SUVs. GM’s retail sales in China rose more than 14% despite economic woes in the world’s largest auto market, buoyed by a cut on the purchase tax there. Those results offset ongoing volatility in South America.
GM’s fourth-quarter revenue was flat compared with a year ago at $39.6 billion.
Joseph Spak, automotive analyst for Royal Bank of Canada Capital Markets, wrote about GM fourth-quarter earnings: "While we would expect the stock to be up, we also wouldn't be surprised if the stock faded as strength is sold given our view that there is a limited bid out there for autos."
Automotive stocks are broadly out of favor, due to the view by many investors that vehicle sales in the U.S., the most profitable global market, have peaked. GM, by contrast, sees room for growth this year. The automaker insisted it can weather the storm.