Initial Q2 Take: Solid Quarter/Guide With Encouraging 2027 Commentary

Research evidence excerpt

Initial Q2 Take: Solid Quarter/Guide With Encouraging 2027 Commentary

TD Cowen General Motors Company

Global Research July 21, 2026

VALUATION METHODOLOGY AND RISKS

Valuation Methodology

Automobiles:

Our automaker valuation methodology is dependent on company-specific circumstances.

For mature automakers, we tend to use an average of P/E and EV/EBITDA. For higher growth

automakers, we tend to use DCF and, where appropriate, probability weighted scenarios.

Investment Risks

Automaker stocks face several risks including: (1) Risks tied to vehicle demand and unit

profitability (macro, trade, competition, geopolitics, adverse changes in segment and/or

powertrain mix); (2) Raw material costs and availability; (3) Labor disruptions; (4) Regulatory

developments and related compliance costs; (5) Execution risks from new product launches

and company-specific initiatives; (6) Headline risks from litigation, regulatory uncertainties,

recalls and product reviews; (7) FCF volatility that can occur upon significant production

declines; (8) Supply-chain related risks.

Risks To The Price Target

Downside:

■ Significant and lasting Mexico/Canada or Korea tariffs

■ Macro, trade and geopolitical events can materially affect auto demand

■ Cost execution setbacks (warranty) and/or higher cost inflation (raw materials)

■ Worse than expected industry pricing owing to macro and/or competition

■ Earnings are highly exposed to US truck segments (pickups/large SUVs)

■ Headline risk from litigation, regulatory uncertainties, recalls or product reviews

■ FCF volatility upon significant changes in auto production rates

■ Supply-chain related risks

■ Labor-related risks, including disruptive strikes

■ Execution risks from new product launches and other company-specific initiatives

2 TDSecurities.com