Now, old Mr. Buffett, a chap who knows a thing or two about hoarding pennies (and rather large sums, naturally), made a bit of a flutter back in 2017. He stuffed ten million shares of General Motors into Berkshire Hathaway’s pockets, paying about $33.95 a pop. A perfectly sensible move, you might think, except everyone else seemed to be doing the opposite! It puffed up Berkshire’s GM holdings by a good 20%, like a prize-winning pumpkin.
He offloaded the lot in 2023, at a paltry $35.59. Not a disaster, mind you, but not exactly a shower of gold coins either. But what if, just what if, he’d held on a little longer? Ah, that’s where the story gets interesting, like a particularly juicy worm.
Today, GM shares are bobbing about at over $80. And if you’d been clever enough to buy in 2017 and reinvest those dividends – those little sprinkles of profit – you’d be sitting on a return of 159.4%! That, my friends, is a proper windfall. Enough to buy a small island, perhaps, or a lifetime supply of fizzy lifting drinks.
How’s GM Doing Now, Though?
Well, in 2025, they hauled in $185 billion in revenue, which is down a smidge – 1.3%, to be precise. Earnings per share (EPS) took a bigger tumble, plummeting 48.7% to $3.24. But don’t let those numbers frighten you too much. There was a bit of a kerfuffle – a $7.2 billion write-down, you see – because their electric vehicle (EV) business wasn’t zooming along quite as quickly as they’d hoped. Seems the public isn’t quite ready to ditch petrol just yet. It’s like trying to teach a badger to waltz.
Despite the wobbles, GM still coughs up a dividend, which is a good sign. They even bumped it up by 20% to $0.18 a share and authorized a $6 billion share repurchase. A bit like sweeping up loose change, really.
President Trump’s tariffs and the end of the EV tax break didn’t help, of course. It’s like building a magnificent sandcastle and then having a grumpy giant stomp on it. But GM is predicting EPS of $11 to $13 in 2026, a rather substantial leap from the $3.27 they managed in 2025. They’re also aiming for adjusted earnings before interest and taxes of $13 to $15 billion. Ambitious, wouldn’t you say?
The Trump administration decided to loosen the rules on car emissions, which means GM can focus on building those lovely, roaring, petrol-guzzling machines again. It’s a bit like letting a child eat all the sweets they want – good for the short term, perhaps, but not terribly sensible in the long run.
Less Appealing as an Income Stock
Is GM worth a nibble for its dividend? Hmmm, not really, if you look closely. The yield is a measly 0.9% at the current price, though it’s reasonably safe with a payout ratio of 37%. But remember, they slashed their dividend by a whopping 76.3% back in 2022, thanks to a bit of a pandemic-induced slump. The automotive business, you see, is terribly cyclical. It’s like a seesaw – up one minute, down the next.
Most of the EV write-offs are probably behind them now, which means they should be able to get back to making a decent profit. But here’s the rub: their annual revenues have only grown by 24% over the last ten years, while their EPS has fallen by over 45%. That’s a rather alarming trend, wouldn’t you agree?
Their shares might be cheap compared to the other Detroit dinosaurs. GM is trading at around 6.2 times expected forward earnings, a smidge less than Stellantis (STLA) at 6.5 and comfortably below Ford Motor Company (F) at 8.7. Still, cheap doesn’t always mean cheerful.
Read More
- Gold Rate Forecast
- Top 15 Insanely Popular Android Games
- Did Alan Cumming Reveal Comic-Accurate Costume for AVENGERS: DOOMSDAY?
- 4 Reasons to Buy Interactive Brokers Stock Like There’s No Tomorrow
- EUR UAH PREDICTION
- Silver Rate Forecast
- DOT PREDICTION. DOT cryptocurrency
- ELESTRALS AWAKENED Blends Mythology and POKÉMON (Exclusive Look)
- Core Scientific’s Merger Meltdown: A Gogolian Tale
- New ‘Donkey Kong’ Movie Reportedly in the Works with Possible Release Date
2026-03-03 22:34