MORGAN STANLEY: GM's 'unique' structure makes it our top auto pick
"GM has made some productive moves and has an opportunity to unlock hidden strategic value," analyst Adam Jonas said in a note raising the bank's price target for GM shares to $43 from $40.
"We mark to market our sum-of-the-parts model and move the stock up to #3 in our ranking. GM is now our highest-ranked OEM in US autos."
Specifically, autonomous driving and ride sharing both added $0.5 billion each to the bank's value assessment.
"Consistent feedback from our sources in the autonomous start-up community suggest GM bought a strong asset with Cruise," a San Francisco-based self-driving startup that GM acquired for more than $1 billion last year, the bank said.
Lyft, in which GM bought a $500 million stake last January, "continues to make good progress both commercially and strategically," the bank said.
Automakers have reported declining sales for four months in a row now, and Wall Street is concerned that the US auto industry could be entering a downturn. GM, in contrast, beat expectations last quarter, despite falling revenues.
"We believe GM's shareholder structure (its lack of a government, family or strategic blocking minority) is unique among the global auto industry," Morgan Stanley said.
Shares of GM are up 22.55% over the last 12 months.
