General Motors Stock Rises Amid Move to EVs | Financial Buzz

General Motors Stock Rises Amid Move to EVs

General Motors (NYSE: GM) has managed to quickly evolve throughout the last few years as technology and companies such as Uber and Lyft change the dynamic of car ownership. Starting in 2016 the automaker made several moves towards shifting to EV as a means to stay relevant. GM has created a shared mobility brand called Maven, launched a car subscription service, acquired an autonomous vehicle company, designed and developed e-bikes as well as taken a 7.8% stake in Lyft.

On Thursday, the company announced that it can beat a coming electric-vehicle race against Tesla. “We are pivoting to a growth strategy,” said Chief Executive Mary Barra at an investor event organized by Barclays. Barra went as far as promising that an additional USD7 Billion of funds would be put into electric vehicles throughout the next five years.

GM has managed to find opportunity amid the ongoing pandemic despite the majority of automakers struggling to survive. After hitting an all-time low on March 18, the company is currently trading at its highest level since June 2018.

“For many years when people said what is it going to take to get the stock moving? Eventually, I had to say – it sounds perverse – but we might actually need to see a recession,” Morningstar’s David Whiston told CNBC. “Then GM can finally prove to the market that ‘Hey, all these years we have been saying we’re not like ‘old GM’ and we really are different … now we have a chance to prove it.′ I think they have proved it.”

Shares surged as GM beat Wall Street’s earnings expectations during the second and third quarters. With news of the new EV efforts, including its GMC Hummer EV, shares have continued upward. 

“They have good fundamentals, upside in numbers but also what’s helping is the EV narrative is accelerating,” Credit Suisse analyst Dan Levy told CNBC. “Overall, a positive news cycle on their endeavors in this area, I think, is helping. It’s a combination of both of those that help.

Shares have risen 157% since march.

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