General Motors (NYSE:GM) & NIO (NYSE:NIO) Financial Review

General Motors (NYSE:GM) and NIO (NYSE:NIO) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, dividends, risk and institutional ownership.

Insider and Institutional Ownership

92.7% of General Motors shares are held by institutional investors. Comparatively, 48.5% of NIO shares are held by institutional investors. 0.4% of General Motors shares are held by company insiders. Comparatively, 1.0% of NIO shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

General Motors has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500. Comparatively, NIO has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Profitability

This table compares General Motors and NIO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
General Motors	2.12%	19.36%	4.37%
NIO	-3.95%	-111.37%	-3.62%

Earnings & Valuation

This table compares General Motors and NIO”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
General Motors	$185.02 billion	0.39	$2.70 billion	$4.36	19.78
NIO	$12.51 billion	0.67	-$2.14 billion	($0.27)	-12.57

General Motors has higher revenue and earnings than NIO. NIO is trading at a lower price-to-earnings ratio than General Motors, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings for General Motors and NIO, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
General Motors	1	4	22	1	2.82
NIO	2	7	6	0	2.27

General Motors presently has a consensus target price of $101.44, suggesting a potential upside of 17.63%. NIO has a consensus target price of $5.78, suggesting a potential upside of 70.18%. Given NIO’s higher probable upside, analysts clearly believe NIO is more favorable than General Motors.

Summary

General Motors beats NIO on 11 of the 14 factors compared between the two stocks.

About General Motors

General Motors Company designs, builds, and sells trucks, crossovers, cars, and automobile parts; and provide software-enabled services and subscriptions worldwide. The company operates through GM North America, GM International, Cruise, and GM Financial segments. It markets its vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Baojun, and Wuling brand names. In addition, the company sells trucks, crossovers, cars, and automobile parts through retail dealers, and distributors and dealers, as well as to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies, and governments. Further, it offers range of after-sale services through dealer network, such as maintenance, light repairs, collision repairs, vehicle accessories, and extended service warranties. Additionally, the company provides automotive financing; and software-enabled services and subscriptions. General Motors Company was founded in 1908 and is headquartered in Detroit, Michigan.

About NIO

NIO Inc. designs, manufactures, and sells electric vehicles in the People's Republic of China. The company is also involved in the manufacture of e-powertrain, battery packs, and components; and racing management, technology development, and sales and after-sales management activities. In addition, it offers power solutions for battery charging needs; and other value-added services. The company was formerly known as NextEV Inc. and changed its name to NIO Inc. in July 2017. NIO Inc. was founded in 2014 and is headquartered in Shanghai, the People's Republic of China.