GM Stock Rises on Switch From NYSE to Nasdaq — WSJ

What happened

General Motors said it will move its stock listing from the New York Stock Exchange to Nasdaq. GM shares jumped this morning after the announcement. The automaker said the move positions it among the biggest players in tech.

Confirmed

Global impact / market context

A Nasdaq listing may let GM attract buying from large funds that track Nasdaq indexes, which means more potential demand for its shares. GM has long tried to convince investors it is a tech-savvy company, not just an old-school industrial giant, but Wall Street has remained unconvinced.

Analyst inference

GM trades at a lower price-to-earnings ratio than Ford, which means investors pay less for each dollar of GM profit. Its share-price gains this year have lagged the S&P 500. The listing switch is the latest executive move to bolster the share price, after the board last week authorized $20 billion in share buybacks.

Analyst inference

What to watch

1. The board last week authorized $20 billion in share buybacks, which means the company can repurchase its own shares. Watch whether GM acts on that authorization and how it affects the share count. Confirmed
2. Watch whether the listing move succeeds in drawing buying from the massive investment funds that track the index, the stated goal of positioning GM among the biggest players in tech. Proposed
3. Watch whether the lower price-to-earnings ratio versus Ford and lagging share-price gains this year narrow after the switch, which would show investors becoming more convinced by GM's tech story. Analyst inference

Evidence

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