GM to showcase electric and autonomous vehicles during investor day

General Motors is set to host its investor day on Wednesday, where executives will showcase the company's forthcoming electric and autonomous vehicles. CNBC's Phil LeBeau gives a preview of what to expect. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2NGeIvi

Wall Street is expecting a lot from General Motors’ two-day investor event that starts Wednesday afternoon – from specific revenue and earnings targets to new details about its electric and autonomous vehicle operations.

But what GM investors really want is a roadmap for sustainable shareholder growth. It’s something the automaker has flirted with under CEO Mary Barra but never been able to achieve.

The stock has swung wildly under Barra’s reign, from a 60% surge in share price to an almost as big drop since she took the helm in January 2014, according to FactSet. Before this year, shares of GM were largely down since Barra took the reins. They’re now up by 36%, with almost all of that growth coming this year alone.

That type of growth is what analysts believe could continue if GM can swiftly deliver on its plans to transform the company — at least in investor eyes — into more of a technology company than a traditional automaker.

“With the core objective of GM’s investor day centered on demonstrating the growth opportunities ahead for GM, we expect a case to be made for GM multiple expansion … which we believe it merits,” Credit Suisse analyst Dan Levy said in an investor note Friday. “We believe a clear case can be made for GM stock north of $100.”

Deutsche Bank analyst Emmanuel Rosner said the event “could serve as a positive catalyst for the stock” if GM meets investor expectations, specifically regarding its plans for electric and autonomous vehicles.

Morgan Stanley analyst Adam Jonas noted several key growth areas and business opportunities for GM, while questioning whether the event will “simply reinforce what many already believe about GM or can it catalyze a more significant change in strategic path?”

Like investors, Barra and her executive leadership team are hoping for the latter. Here are five ways GM is going to try and make that happen.

Details

Investors should expect an unprecedented amount of details during the event, including specific targets regarding revenue, profit margins and the outlook on total market size for early expansion businesses like self-driving taxis.

It’s one of two things Jonas believes will be important for GM to accomplish: “Provide the transparency and disclosure to help the analyst and investment community to both model and value the company’s critical tech-oriented business units,” he said in an investor note last week.

GM’s revenue last year was nearly $122.5 billion, down 10.8% compared with 2019 thanks largely to factory shutdowns at the beginning of the coronavirus pandemic. It still made $6.4 billion in net income for the year while its adjusted operating profit was $9.7 billion, or $4.90 a share, in 2020.

Urgency

The other important thing for GM is leaving the “investment community with the sense of urgency that the company is taking the necessary steps to attract the necessary capital and talent to allow GM’s capabilities to be successful,” Jonas said.

Barra and other GM executives such as President Mark Reuss and CFO Paul Jacobson are expected to discuss how the automaker is investing as fast as possible in electric and autonomous vehicles to bring the technologies to market more quickly.

GM earlier this year said it would invest $35 billion in electric and autonomous vehicles by 2025, up 30% from plans announced late last year.

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