The GM logo is seen at the General Motors Warren Transmission Operations Plant in Warren, Michigan October 26, 2015. REUTERS/Rebecca CookCLUTCH MOVE. General Motors swerved around Covid-19 potholes in third-quarter results released on Thursday. The $50 billion automaker’s adjusted earnings per share of $2.83 were over twice analysts’ estimate, according to Refinitiv. U.S. consumers – possibly buoyed by stimulus or less spending on services – scooped up trucks and SUVs.
Part of the explanation is an economic rebound. In the second quarter, U.S. GDP slumped 9% from a first-quarter level already dented by early lockdown damage. Last quarter, it rebounded more than 7%, according to an initial estimate from the Bureau of Economic Analysis, leaving output down 3.5% from the final three months of 2019.
Earnings per share rose 6% though, beating analyst expectations on both the top and bottom line. Cigna raised its revenue estimate for the rest of the year. Even once life returns to normal, Cigna is well-positioned. The health insurance industry simply isn’t that competitive. Three-quarters of American metro areas have highly concentrated insurance markets, using the Herfindahl-Hirschman Index. That’s something even Democrats in Washington have struggled to change.
END OF THE SHOW. Milan’s famed La Scala opera house has become the latest cultural victim of the pandemic. A new lockdown set to start in Italy’s financial capital on Friday and a rash of Covid-19 infections among its musicians and singers forced the 18th-century theatre to scrap its usually bedazzling premiere, scheduled for Dec. 7, for the first time since World War Two.
AstraZeneca and Johnson & Johnson have already promised to make successful vaccines available at cost during the pandemic. Although the treatment may become as ubiquitous as the annual flu jab, it will be difficult for pharmaceutical giants, already under scrutiny for price-gouging, to make too much money. Shares of companies that have promised to develop remedies are outperforming the broader index of pharmaceutical and biotechnology stocks.