How GM hopes to woo Wall Street during its two-day investor event

DETROIT – Wall Street is expecting a lot from General Motors’ two-day investor event that starts Wednesday afternoon  – from specific revenue and earnings targets to new details about its electric and autonomous vehicle operations.

But what GM investors really want is a roadmap for sustainable shareholder growth. It’s something the automaker has flirted with under CEO Mary Barra but never been able to achieve.

The stock has swung wildly under Barra’s reign, from a 60% surge in share price to an almost as big drop since she took the helm in January 2014, according to FactSet. Before this year, shares of GM were largely down since Barra took the reins. They’re now up by 36%, with almost all of that growth coming this year alone.

That type of growth is what analysts believe could continue if GM can swiftly deliver on its plans to transform the company — at least in investor eyes — into more of a technology company than a traditional automaker.

“With the core objective of GM’s investor day centered on demonstrating the growth opportunities ahead for GM, we expect a case to be made for GM multiple expansion … which we believe it merits,” Credit Suisse analyst Dan Levy said in an investor note Friday. “We believe a clear case can be made for GM stock north of $100.”

Deutsche Bank analyst Emmanuel Rosner said the event “could serve as a positive catalyst for the stock” if GM meets investor expectations, specifically regarding its plans for electric and autonomous vehicles.

Morgan Stanley analyst Adam Jonas noted several key growth areas and business opportunities for GM, while questioning whether the event will “simply reinforce what many already believe about GM or can it catalyze a more significant change in strategic path?”

Like investors, Barra and her executive leadership team are hoping for the latter. Here are five ways GM is going to try and make that happen.

Investors should expect an unprecedented amount of details during the event, including specific targets regarding revenue, profit margins and the outlook on total market size for early expansion businesses like self-driving taxis.

It’s one of two things Jonas believes will be important for GM to accomplish: “Provide the transparency and disclosure to help the analyst and investment community to both model and value the company’s critical tech-oriented business units,” he said in an investor note last week.

GM’s revenue last year was nearly $122.5 billion, down 10.8% compared with 2019 thanks largely to factory shutdowns at the beginning of the coronavirus pandemic. It still made $6.4 billion in net income for the year while its adjusted operating profit was $9.7 billion, or $4.90 a share, in 2020.