Freedom Broker analysts: General Motors stock upside is exhausted

Freedom Broker analysts maintain a “Hold” rating on General Motors (GM) shares with a target price of $76. At the current quote of around $82, there is no upside potential. Despite beating expectations for Q2 2026 results and raising its full-year guidance, the analysts believe the automaker’s margin outlook for the coming quarters remains constrained.

General Motors is one of the largest automakers in the U.S.

General Motors (GM) is an American automotive corporation that manufactures vehicles under the Chevrolet, Buick, GMC, and Cadillac brands. The company also develops its finance arm GM Financial, its electric-vehicle business, and its defense business GM Defense. GM remains one of the leaders in the U.S. new-vehicle market, but faces high borrowing costs, expensive vehicles, and weakening demand for electric vehicles.

Results beat expectations, but analysts remain cautious

General Motors exceeded consensus forecasts for Q2 and raised its 2026 outlook for the second time this year, Freedom Broker analysts note. However, the experts lowered their estimates for a number of financial metrics, as they take a more cautious view of margin dynamics over the next few quarters.

In Q2, GM’s revenue rose 1.9% year over year to $48 billion. Adjusted EBIT increased 29.8% to $3.9 billion, and the margin expanded from 6.4% to 8.2%.

Adjusted earnings per share came in at $3.57 versus $2.53 a year earlier and beat analysts’ expectations of $3.19. At the same time, net income, by contrast, fell 31.1% to $1.3 billion from $1.9 billion a year earlier. The difference between the dynamics of adjusted and net income is due to the impact of certain expenses and adjustments.

GM raised its 2026 guidance

The company improved its full-year guidance for key metrics. General Motors now expects:

— adjusted EBIT in the range of $14–16 billion versus the prior forecast of $13.5–15.5 billion;

— adjusted automotive free cash flow of $9.5–11.5 billion versus $9–11 billion previously;

— adjusted earnings per share of $12–14 versus the prior forecast of $11.50–13.50.

The guidance raise marked the second in 2026. However, Freedom Broker analysts believe that the strong Q2 results do not eliminate risks to business profitability. In particular, additional costs associated with revising electric-vehicle production plans may persist at least through Q3 2026.

Sales in North America remain under pressure

GM’s wholesale vehicle shipments in Q2 rose 1.6% to 990 thousand vehicles. At the same time, shipments in North America were virtually unchanged year over year, slipping 0.1%.

The main factor of pressure remains weak demand for electric vehicles, the experts believe. At the same time, the U.S. new-vehicle market faces high borrowing costs and persistently low affordability for buyers. The average price of a new vehicle in the country has been holding around $50 thousand since the beginning of the year, and auto loan costs remain elevated.

Outside North America, GM shipments rose 13.6% to 142 thousand vehicles. Growth was driven mainly by sales in South America, which offset supply disruptions amid tensions in the Middle East.

Analysts see upside potential in 2027

Freedom Broker estimates GM’s 2026 revenue at about $185.9 billion, implying growth of roughly 0.5% year over year. In 2027, the figure could increase to $195.1 billion.

Analysts expect vehicle shipments in North America could return to growth by the end of 2026, and a model lineup refresh in 2027 could accelerate revenue growth and support pricing. In particular, a broader model range and the development of the Super Cruise driver-assistance system could improve the company’s pricing position.

However, before that GM will have to go through a period of elevated expenses. Therefore, despite improved operating performance, Freedom Broker maintains a neutral Hold recommendation and a $76 target price based on a five-year discounted free cash flow model.

GM strengthens its industrial and defense business

In June 2026, GM’s defense unit GM Defense announced a partnership with Lockheed Martin (LMT). The companies intend to cooperate on projects related to strengthening the U.S. industrial base, supply chains, and the adoption of advanced manufacturing technologies.

In Q1, GM’s U.S. sales fell by almost 10% to 626,429 vehicles amid high auto loan rates, expensive vehicles, and overall economic uncertainty. At the same time, the entire U.S. auto market contracted by about 5.3% year over year.

A separate factor of pressure remains the decline in demand for electric vehicles (EV), Freedom Broker experts emphasized. The EV share of new-vehicle sales in the U.S. fell from about 8% in Q1 2025 to around 6% in 2026. This was one of the reasons for GM to revise its production plans and led to additional expenses.

Not an individual investment recommendation.