GM To Roll Out EV Delivery Vehicles Under BrightDrop Unit; Shares Climb 4%
Shares of General Motors rose about 4% in Tuesday’s extended trading session after closing 6.3% higher on the day, as the automaker unveiled a new business unit named BrightDrop to further ease the delivery of goods and services.
General Motors (GM) said that the BrightDrop unit will offer “an ecosystem of electric first-to-last-mile products, software and services to empower delivery and logistics companies to move goods more efficiently.”
Notably, BrightDrop’s first product will be an electric pallet called EP1, which will help in delivering goods over short distances. It will be available in early 2021. BrightDrop’s second product will be a light commercial electric vehicle, EV600, built for delivery of packages over long distances. FedEx Corp.’s (FDX) FedEx Express will become the first customer of BrightDrop’s EV vehicle, EV600.
The company said that BrightDrop solutions will help businesses to transport goods at a lower cost and in an improved and more sustainable way. It will also maximize productivity and improve employee safety. (See GM stock analysis on TipRanks).
On Dec. 21, Benchmark analyst Michael Ward raised the stock’s price target to $51 (6.7% upside potential) from $47 and maintained a Buy rating. The analyst believes that the company’s operations in North America and China, and GM Financial are likely to drive 2021 performance. He further believes that the current low interest rate environment, along with rising used vehicle prices and relatively stable loan loss metrics would give an additional upside to the stock.
Overall, consensus among analysts is a Strong Buy based on 11 Buys and 1 Hold. The average analyst price target of $51.92 implies upside potential of about 8.6% to current levels. Shares have gained 39.7% in one year.
From TipRanks’ Smart Score system, the stock scores a “Perfect 10”.
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