General Motors (GM) Stock Sinks As Market Gains: Here's Why

General Motors (GM) stock recently declined 1.5%, underperforming both the S&P 500 and its sector over the past month, as the company anticipates significant year-over-year declines in its upcoming quarterly earnings, with EPS projected to fall 21.62% and revenue 9.37%. Despite these negative forecasts and a recent 0.09% drop in consensus EPS estimates leading to a Zacks Rank #3 (Hold), GM trades at a notable discount with a Forward P/E of 6.07 and a PEG ratio of 1.21, significantly below industry averages of 12.85 and 2.42, respectively.

Analysis

We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties. You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies. In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time. You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities. If you wish to go to ZacksTrade, click OK. If you do not, click Cancel. General Motors (GM) Stock Sinks As Market Gains: Here's Why Read MoreHide Full Article General Motors (GM - Free Report) closed at $56.40 in the latest trading session, marking a -1.5% move from the prior day. The stock's performance was behind the S&P 500's daily gain of 0.58%. Coming into today, shares of the an automotive manufacturer had lost 1.29% in the past month. In that same time, the Auto-Tires-Trucks sector gained 14.95%, while the S&P 500 gained 3.68%. The investment community will be closely monitoring the performance of General Motors in its forthcoming earnings report. The company is scheduled to release its earnings on October 21, 2025. The company's upcoming EPS is projected at $2.32, signifying a 21.62% drop compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $44.19 billion, down 9.37% from the year-ago period. For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $9.43 per share and a revenue of $180.22 billion, representing changes of -11.04% and -3.86%, respectively, from the prior year. Investors might also notice recent changes to analyst estimates for General Motors. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability. Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system. Ranging from 1 (Strong Buy) to 5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with 1 stocks returning an average of +25% annually since 1988. Over the past month, there's been a 0.09% fall in the Zacks Consensus EPS estimate. General Motors is currently a Zacks Rank 3 (Hold). Investors should also note General Motors's current valuation metrics, including its Forward P/E ratio of 6.07. For comparison, its industry has an average Forward P/E of 12.85, which means General Motors is trading at a discount to the group. One should further note that GM currently holds a PEG ratio of 1.21. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Automotive - Domestic industry was having an average PEG ratio of 2.42. The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. Currently, this industry holds a Zacks Industry Rank of 171, positioning it in the bottom 31% of all 250+ industries. The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1. Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com. See More Zacks Research for These Tickers Normally $25 each - click below to receive one report FREE: Image: Bigstock General Motors (GM) Stock Sinks As Market Gains: Here's Why General Motors (GM - Free Report) closed at $56.40 in the latest trading session, marking a -1.5% move from the prior day. The stock's performance was behind the S&P 500's daily gain of 0.58%. Coming into today, shares of the an automotive manufacturer had lost 1.29% in the past month. In that same time, the Auto-Tires-Trucks sector gained 14.95%, while the S&P 500 gained 3.68%. The investment community will be closely monitoring the performance of General Motors in its forthcoming earnings report. The company is scheduled to release its earnings on October 21, 2025. The company's upcoming EPS is projected at $2.32, signifying a 21.62% drop compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $44.19 billion, down 9.37% from the year-ago period. For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $9.43 per share and a revenue of $180.22 billion, representing changes of -11.04% and -3.86%, respectively, from the prior year. Investors might also notice recent changes to analyst estimates for General Motors. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability. Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system. Ranging from 1 (Strong Buy) to 5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with 1 stocks returning an average of +25% annually since 1988. Over the past month, there's been a 0.09% fall in the Zacks Consensus EPS estimate. General Motors is currently a Zacks Rank 3 (Hold). Investors should also note General Motors's current valuation metrics, including its Forward P/E ratio of 6.07. For comparison, its industry has an average Forward P/E of 12.85, which means General Motors is trading at a discount to the group. One should further note that GM currently holds a PEG ratio of 1.21. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Automotive - Domestic industry was having an average PEG ratio of 2.42. The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. Currently, this industry holds a Zacks Industry Rank of 171, positioning it in the bottom 31% of all 250+ industries. The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1. Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com. General Motors (GM) stock has recently demonstrated significant underperformance, declining 1.5% in the latest trading session and 1.29% over the past month, while the broader S&P 500 and its Auto-Tires-Trucks sector saw gains of 3.68% and 14.95% respectively. This divergence precedes the company's anticipated challenging earnings report scheduled for October 21, 2025, which carries a moderately negative sentiment with a score of -0.7 for GM itself. The company's upcoming third-quarter earnings are projected to show a substantial year-over-year decline, with EPS expected to fall 21.62% to $2.32 and revenue decreasing 9.37% to $44.19 billion. Furthermore, full fiscal year estimates reflect an 11.04% drop in EPS to $9.43 and a 3.86% reduction in revenue to $180.22 billion, compounded by a recent 0.09% downward revision in the Zacks Consensus EPS estimate. Despite these deteriorating fundamentals and a Zacks Rank 3 (Hold), GM trades at a considerable valuation discount compared to its industry, boasting a Forward P/E of 6.07 versus the industry average of 12.85, and a PEG ratio of 1.21 against the industry's 2.42. However, the 'Automotive - Domestic' industry itself is ranked poorly at 171 out of 250+ industries, indicating systemic challenges within the sector.

Key Decisions for Investors

• Exercise caution leading into GM's October 21, 2025 earnings report, given the significant projected declines in both quarterly EPS (-21.62%) and revenue (-9.37%) which suggest continued operational headwinds.
• Monitor actual earnings performance against these low expectations for any signs of stabilization or further deterioration, as analyst estimate revisions indicate a persistent downward trend.
• Consider the valuation discount (Forward P/E of 6.07, PEG of 1.21) in the context of the weak 'Automotive - Domestic' industry rank (171) and GM's Zacks Rank #3 (Hold) rating, suggesting potential value but within a challenging sector.
• Track future analyst estimate revisions for GM and observe broader industry trends, as these can significantly impact the stock's performance despite current valuation appeal.