General Motors (GM) delivered solid Q3 results, while a large share buyback reinforces management's confidence in its earnings outlook, though rising commodity and logistics costs will weigh on 2027 earnings, RBC Capital Markets said.
The company reported Q3 adjusted EBIT of $4.1 billion largely in line with consensus expectations. North American margins widened 250 basis points from a year earlier to 8.7%, the investment firm said in a research note Tuesday.
General Motors also announced a new $20 billion multi-year share buyback authorization. RBC said is worth more than 25% of its current market value.
The investment firm lowered its 2027 adjusted EBIT estimate by about $1 billion to roughly $15.3 billion as commodity and logistics costs rise. It said steel and copper prices are up 10% to 15% since July.
RBC maintained its outperform rating and cut its price target to $98 from $102.
Shares of General Motors were down 1.7% in Wednesday afternoon trading.
Price: 75.76, Change: -1.33, Percent Change: -1.73
