Why General Motors Stock Skyrocketed Today

General Motors (NYSE: GM) stock roared higher in Tuesday's trading. The auto giant's share price gained 14.9% thanks to strong quarterly results.

Before the market opened this morning, GM published its third-quarter results -- and performance for the period came in better than anticipated. In addition to sales and earnings beats, the company issued encouraging forward guidance.

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GM stock surges on strong Q3 report

For Q3, GM reported non-GAAP (adjusted) earnings per share (EPS) of $2.80 on sales of $48.59 billion. EPS came in $0.48 above the level targeted by the average Wall Street analyst estimate. While the company's sales were down roughly 0.3% year over year, sales and earnings results for the period still topped the market's expectations.

Management touted the business's strong earnings and free-cash-flow performances in the quarter. The company posted its best Q3 market-share performance since 2017; strong margins and a restructuring for the China segment helped deliver better-than-expected earnings performance.

What's next for GM?

In conjunction with its encouraging Q3 results, GM raised its full-year performance targets. The company now anticipates that adjusted EPS for the year will be between $9.75 and $10. Previously, the auto giant had guided for adjusted EPS to be between $8.25 and $10.

Management now expects tariff-related costs to come in at $4.5 billion -- down from its previous forecast for costs of $5 billion. At least $1.2 billion of those costs are expected to eventually be offset by shifting some truck production back to domestic plants. With lower-than-anticipated tariff costs helping to support higher earnings, investors are feeling more bullish about GM.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool recommends General Motors. The Motley Fool has a disclosure policy.