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The fast and furious profitability of General Motors

Investment from 8,200 USD

Investment period until: 15/09/2017

Expected
yearly returns
29%

General Motors Co. manufactures and supplies the market with personal and commercial vehicles and offers vehicle security systems, service maintenance, spare parts and auto-financing all over the world. The main brands are: Chevrolet, GMC, Cadillac, Pontiac, Oldsmobile, Saturn, Opel, Vauxhall, Holden, Autobaojun, SGMW, Fawjiefang and others. It is the largest American car company with established retail systems in 192 countries and manufacturing facilities in 35. Geographical revenue diversification (share): North America: 74.3%, Europe: 12.3%, South America: 5.1%, Asia, Africa and others: 8.3%.

Their improving financial performance will further facilitate a growth in share prices. Return on equity grew throughout the first, second and third quarters of 2016 and amounted to 27.69%, 31.59% and 34.93% respectively. Return on assets in the first, second and third quarters of 2016 also grew, and amounted to 5.58%, 6.28% and 6.82% respectively. The same can be said for return on invested capital, which in the first, second and third quarters of 2016 amounted to 7.84%, 8.59% and 9.46% respectively. Financial stability continues to increase thanks to a decreasing debt load. The ratio of net debt to EBITDA in the second quarter of 2016 decreased by 6.38% (QoQ) and by 2% (QoQ) in the third. The ratio of total debt to EBITDA in the second quarter decreased by 8.01% (QoQ), and by 9.6% in the third. Another contributing factor to the company growth will be the implementation of Donald Trump program, which focuses on supporting the automotive industry and US domestic demand.

Investment period ends:
15/09/2017

Expected yield is calculated according to 98% capital protection and the price of the base asset at expiry, equal to 49.8 USD.

Technical Analysis:

General Motors share price has left the Ichimoku indicator cloud upwards and broken upwards through the 50-, 100- and 200- daily moving averages. The upward trend continues. The significant technical levels are: 27.51; 30.09; 32.83; 34.56; 36.52; 38.23; 39.59; 41.44.

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