CORPORATESISSUER COMMENT 2 NOVEMBER 2015GENERAL MOTORS COMPANY (GM)Moodys Senior Unsecured Rating Ba1Moodys Outlook STABond-Implied Rating Baa3CDS-Implied Rating Ba1EDF-Implied Rating Baa2As of 10/29/2015ANALYST CONTACTSAllerton G. Smith 212-553-4058 Sr Dir-Sr Research Analyst allerton.smith@moodys.comABOUT CAPITAL MARKETS RESEARCHAnalyses from Moodys Capital Markets Research, Inc. (CMR) focus on explaining signals from the credit and equity markets. The publications address whether market signals, in the opinion of the groups analysts, accurately reflect the risks and investment opportunities associated with issuers and sectors. CMR research thus complements the fundamentally-oriented research offered by Moodys Investors Service (MIS), the rating agency.CMR is part of Moodys Analytics, which is one of the two operating businesses of Moodys Corporation. Moodys Analytics (including CMR) is legally and organizationally separated from Moodys Investors Service and operates on an arms length basis from the ratings business. CMR does not provide investment advisory services or products.View the CMR FAQ Contact the CMR team Follow us on TwitterMoodys Analytics markets and distributes all Moodys Capital Markets Research, Inc. materials. Moodys Capital Markets Research, Inc. is a subsidiary of Moodys Corporation. Moodys Analytics does not provide investment advisory services or products. For further detail, please see the last page.Market Signals ReviewGeneral Motors: Two Market-Implied Ratings Rise Following Settlements The CDS- and EDF'-implied ratings for GM both improved over the past two months; its bond-implied rating did not change. The upticks followed the announcement on September 17 of an agreement with the Department of Justice and the settlement of civil litigation charges related to defective ignition switches.FIGURE 1. GM: MOODYS AND MARKET-IMPLIED RATINGS, 60 DAYS (DAILY DATA)The companys CDS-implied rating is now Ba1 (Figure 1), rising two notches over the last two months. For much of the last year the CDS-implied rating for GM was Ba1. It rose to Baa3 for a single day (April 22, 2015). Then it worsened to Ba3 in late-August and early September.GMs EDF-implied rating is Baa2, one notch better than two months ago.MOODY'S ANALYTICS CORPORATES2 2 NOVEMBER 2015 MARKET SIGNALS REVIEW: GENERAL MOTORS: TWO MARKET-IMPLIED RATINGS RISE FOLLOWING SETTLEMENTSThe bond-implied rating has been Baa3 every day over the last two months.According to our ratings gap-conditioned transition matrices, companies rated Ba1 with a bond-implied rating of Baa3 outperformed the broad market 36% of the time over the following 12 months, matched the markets performance 11% of the time, and underperformed the broad market 52% of the time.Readers will recall that when a market-implied rating is unchanged the underlying securities have matched the performance of the broad market, and when an implied-rating rises t...
