General Motors (GM) could see stronger earnings, steadier cash flow, better margins, and more support from software and services as tariff pressure eases and higher margin revenue grows, Wedbush said in a note Tuesday.
General Motors' Q1 results came in above expectations and showed the company is managing a weak EV market while holding up better through pricing and a shift toward more profitable business lines, while its software and services business is becoming a bigger growth driver, supported by rising deferred revenue, stronger digital services sales, and more Super Cruise users, Wedbush analysts noted.
Recurring revenue streams could support margin growth over time and give General Motors more stability even as the auto market stays uncertain, Wedbush said.
The firm said lower tariff costs and a roughly $500 million benefit tied to the court decision should help General Motors offset higher commodity, freight, logistics, and memory chip costs through fiscal 2026.
Wedbush kept its outperform rating and $95 price target, saying that General Motors is working through a tough tariff and EV backdrop, but it expects the company's stronger software mix and improved guidance to support its positive view on the stock.
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