GM - ’26 Upside & ’27 Growth Despite Input Costs; STLA Capital Markets Day Preview

Research evidence excerpt

GM - ’26 Upside & ’27 Growth Despite Input Costs; STLA Capital Markets Day Preview

Wolfe Research Auto Daily

GM - ’26 Upside & ’27 Growth Despite Input Costs; STLA May 14, 2026

Capital Markets Day Preview

The Wolfe Byte

In today's Wolfe Autos Daily: 1) Updating GM ests, restocking cycle + cost levers bolstering '27 growth despite

commodities concerns, 2) STLA likely to outline path to earnings / FCF via organic & inorganic actions at CMD.

GM - ’26 Upside & ’27 Growth Despite Input Costs

After outlining our initial take defending GM in the 4/29 Daily, we are updating our GM model to reflect strong Q1

performance, updated guidance, and increased commodity headwinds. The stock has been mixed in recent trading (down

~3% since reporting) – reflecting a healthy debate around the implied ’26 earnings cadence & ’27 outlook. Indeed, the

implied 2Q-4Q earnings run-rate is below ingoing expectations, reflecting higher input costs. But… bulls would point

to the conservative assumptions underpinning mgmt’s commodities outlook (assumes current spot/fwd remains steady

through YE), which somewhat de-risks add’l downside. Most importantly, we continue to see a favorable ’27 setup for

earnings / FCF growth as restocking cycle & cost performance should offset higher input costs.

Solid ‘26 Outlook w/ Upside from Potl. T1XX Restocking

GM raised its 2026 EBIT guidance to $13.5-$15.5bn (from prior $13.0-$15.0bn) and EPS to $11.50-$13.50 (from prior

$11.00-$13.00), reflecting the $500m IEEPA tariff adjustment recorded in Q1. Mgmt. did not underwrite cash pmt in

’26, reiterating the existing $9.0-$11.0bn FCF guide. Ex-IEEPA, mgmt maintained FY26 guidance despite a worsening

raw mat outlook, which was neutralized by Q1 outperformance & improved FX.