GM’s Rises After Profit Beats Estimates on Truck Prices
By Tim Higgins Apr 24, 2014 10:19 AM ET
General Motors Co. (GM) beat analyst estimates and avoided posting its second quarterly loss since bankruptcy as higher prices on new pickups largely made up for the costs of recalls.
With its new Chevrolet Silverado selling for higher prices than the previous version, GM did better than analysts had predicted. The company has faced criticism for its slow response to complaints about small cars with ignition switches linked to at least 13 deaths. And with a $1.3 billion charge for the cost of recalling 7 million vehicles this year, some analysts had predicted that the Detroit-based automaker would lose money for the first time since 2009.
“The stock is reacting positively this morning because they just didn’t post a loss -- it almost didn’t matter what the number was as long as it was above zero,” Christian Mayes, an analyst with Edward Jones, said today in a telephone interview. “Some investors are probably wiping their brow that it wasn’t a loss and thinking this is probably the worst quarter for these issues.”
GM rose 2.5 percent to $35.25 at 10:18 a.m. New York time after jumping as much as 3.8 percent for the biggest intraday gain since Dec. 4. Through yesterday’s close, the stock had fallen 16 percent this year.
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http://www.bloomberg.com/news/2014-04-24/gm-s-first-quarter-profit-beats-estimates-on-truck-prices.html
